Global Forex Outlook: CPI, the Fed, and a Packed Central Bank Calendar

Key Points

• The Reserve Bank of Australia (RBA) held rates steady at the end of September, rallying the AUD/USD exchange rate near the mid-point of its recent 0.6400–0.6900 range.
• A U.S. government shutdown has thrown a wrench in the global financial markets, but an upcoming inflation report (October 15) and policy meeting of the Federal Reserve (October 28-29) loom as key catalysts.
• With the ECB, BoJ, BoC, and BoE all meeting in late October and early November, the forex market faces a dense cluster of events that could fuel additional volatility in the markets.  

The U.S. government shutdown has become the dominant storyline in global markets, injecting fresh uncertainty into an already fragile backdrop. But looking beyond that political flash point, currency traders face a packed stretch of economic data and central bank decisions that should define FX trends in Q4, as detailed below:

• October 15: U.S. CPI Report (inflation report)
• October 28–29: Federal Reserve (Fed)
• October 29: Bank of Canada (BoC)
• October 29–30: European Central Bank (ECB)
• October 29–30: Bank of Japan (BoJ)
• November 6: Bank of England (BoE)

Two important decisions are already in the books. In Australia, the Reserve Bank of Australia (RBA) held its policy rate at 3.60% during the September 29–30 meeting. Policymakers acknowledged that headline inflation has crept back up to 3.0% but noted that underlying pressures have eased, giving them room to pause and assess how earlier easing is working its way through the economy. Futures markets now view November as the next likely window for another adjustment, depending on incoming data.

In Switzerland, the Swiss National Bank (SNB) also stayed the course, leaving rates unchanged at 0% on September 25. The decision underscored its long-running ultra-accommodative stance and Switzerland’s entrenched role as a global safe haven. For FX traders, the takeaway is clear: the franc remains a currency that tends to strengthen in times of stress—even when domestic policy appears static.

Implications for the AUD/USD Currency Pair

The RBA’s decision to hold rates steady at its September meeting didn’t catch markets off guard—traders had largely priced in a pause after August’s surprise cut. Still, the statement carried weight. By striking a patient tone, the bank signaled it isn’t in a rush to ease further, which lent the Australian dollar a modest degree of support against the U.S. dollar in the immediate aftermath. However, the door to additional cuts remains open, keeping a dovish undercurrent in place.

Looking beyond the initial reaction, the Aussie’s trajectory still depends more on external forces than on the RBA itself—with China front and center. Australia’s economy is heavily tied to commodity exports such as iron ore, coal, and LNG, and Chinese demand remains the single biggest driver of those markets. Unless there’s a convincing rebound in China’s growth outlook, any bursts of AUD/USD strength may prove fleeting, leaving the pair rangebound between 0.6400 and 0.6900 since April until a more decisive catalyst emerges. Outside of US dollar, the Aussie has outperformed recently, most notably against its Australasian neighbor the New Zealand Dollar. AUD/NZD has surged since August, now off slightly from highs dating back to 2023 hit earlier this week.

Near-Term Catalysts for the U.S. Dollar

With the RBA decision behind us, attention shifts squarely onto the U.S., where the dollar remains the anchor of global FX markets. Political brinkmanship over federal funding has raised the specter of a government shutdown, adding a layer of policy risk to an already delicate macro backdrop. If a shutdown were to materialize, one major consequence could be delays or suspension in key U.S. economic data releases—most notably the October CPI—which might throw markets and the Fed off balance.

The next major scheduled data release is the October 15 CPI report, though a government shutdown could delay its publication. However, whenever the report is released, a soft reading would likely reinforce expectations for more aggressive Fed easing and weigh on the dollar. Conversely, a hotter-than-expected print would tend to support U.S. yields and strengthen the greenback heading into the October 28–29 Fed meeting, where markets currently imply a high probability of a 25-basis-point cut (bringing the fed funds target range to 3.75%–4.00%).

Beyond the Fed, global growth remains the wildcard. If Europe, Japan, or other major economies falter, safe-haven demand could override any interest-rate narrative and pull capital into the dollar. History shows that in times of heightened stress, investors flock to the greenback for liquidity and safety, even when U.S. rates are moving lower. The pandemic-era rally of 2021–2022 and the mid-2010s “U.S. exceptionalism” trade both highlighted how powerful those flows can be.

In short, leaning too heavily on a weaker-dollar narrative could be risky. The next dollar rally may not come from rate differentials at all, but from safe-haven flows if global growth falters.

Takeaways

The September meeting of the Reserve Bank of Australia delivered exactly what markets expected: a steady hold at 3.60%. With headline inflation a touch firmer but core pressures easing, policymakers signaled patience, leaving AUD/USD largely rangebound between 0.6400 and 0.6900. Without a decisive shift in China’s growth outlook, the Aussie is likely to stay pinned in this band, with only short-lived bursts of volatility around data releases.

Looking ahead, U.S. dollar–focused catalysts remain paramount for global FX markets. The October 15 CPI report—though potentially delayed by a government shutdown—along with the Fed’s October 28–29 meeting will likely set the stage for the next major move in the DXY. Stronger inflation data, or a more cautious Fed, could extend the dollar’s upswing, while softer CPI would likely reignite downside momentum. The bigger swing factor, however, is global growth. If recession fears intensify, safe-haven demand could send the greenback higher regardless of what the Fed does next.

Beyond the Fed, attention will also turn to late October and early November, when the ECB, BoJ, BoC, and BoE all issue policy decisions within days of one another. That cluster of meetings could inject an additional layer of volatility into FX markets—particularly if those central banks diverge meaningfully from the Fed’s policy path.