Oil Near $110 Meets Fed and ECB Decisions in a Heavy Week

Markets start a heavy week on Monday with oil close to 110 dollars a barrel, fresh inflation pressure in the United States, and two central bank decisions waiting in the last week of October.

Brent crude touched 110 dollars on Friday for the first time since May and settled just below that level, up 4.7 percent on the week, as attacks on shipping in the Strait of Hormuz and on Saudi targets kept energy prices high. West Texas Intermediate settled at 101.41 dollars on Friday, up 3.51 percent on the day. Gold closed the week at 4,186.70 dollars an ounce, down 0.7 percent. Bitcoin ended the week almost flat near 82,650 dollars.

The inflation problem has not gone away

US data last week ran hot. Consumer prices rose 3.7 percent year on year in September, up from 3.4 percent in August, and core inflation reached 2.6 percent. Producer prices posted their biggest gain since 2022, and retail sales beat forecasts. The 10 year Treasury yield held near 5.10 percent, and the Nasdaq lost about 4 percent on the week, its worst week since June.

That mix has changed the mood around the Federal Reserve meeting on October 27 and 28. Before the inflation reports, a rate hold looked settled. Traders now treat a hike as a live possibility, and Fed Chair Kevin Warsh gave no clear signal in his remarks at an IMF event in Bangkok last week, where he did not comment on whether rates would rise before the end of the year. The European Central Bank decides on October 29, a day after the Fed, with the same oil shock feeding prices in Europe.

Monday starts in Asia

The first test comes at 02:00 GMT on Monday, when China publishes third quarter growth and September factory, retail and investment data. Economists expect growth of 4.4 percent, below the lower end of Beijing's full year target range. US stock futures reopen on Sunday evening in New York, which gives the first read on how traders price the weekend's headlines from the Gulf. Later in the week, Japan publishes trade and inflation data, and Europe gets earnings from ABB, SAP, Nestle, L'Oreal, Hermes and EssilorLuxottica, while Netflix, Tesla and Meta report in the United States.

Key numbers

• Brent crude: touched 110 dollars on Friday, up 4.7 percent on the week
• WTI crude: settled at 101.41 dollars on Friday
• Gold: 4,186.70 dollars an ounce at Friday's close
• US consumer inflation: 3.7 percent year on year in September
• US 10 year Treasury yield: near 5.10 percent
• Fed decision: October 28, ECB decision: October 29

What happens next

Oil sets the tone. If Brent holds near 110 dollars into the Fed meeting, the inflation story stays in charge and rate sensitive stocks stay under pressure. A cooler China print or progress on Hormuz shipping talks would ease that pressure fast. Until then, every desk is watching the same three things: the oil price, the futures open, and any word from Fed officials before the blackout period.