Polls and politics

Daily update

The October US ISM manufacturing sentiment poll is due. Falling survey repose rates and rising political polarisation have conspired to reduce the reliability of survey-based evidence. The risk is that in the absence of proper US economic data, investors turn in desperation to surveys and give them more credibility than they deserve.
There are two Federal Reserve speakers scheduled. The very unusual three way vote on policy, Fed Chair Powell downplaying the certainty of a December rate cut, and other Fed officials suggesting they do not support further cuts adds uncertainty to the Fed’s direction.
Several US state and local government elections take place tomorrow. While these are an incomplete guide to Federal trends investors will start to focus on the mid-term elections next year (and what that might mean for fiscal policy). The US Supreme Court hears arguments around the legality of some of US President Trump’s tariffs on Wednesday. The line of questioning may give hints as to whether tariffs may be overruled, potentially giving a tax rebate to US companies.
OPEC+ announced a pause in production increases in the first quarter of next year. Oil prices moved a little higher on the news but this is not an economically significant change (and will not change inflation assumptions).