Macroeconomics: The Day Ahead for 23 September 2026

The huff and puff of political rhetoric about the conflicts in the Middle East continues, though the drop in the number of skirmishes in the Persian Gulf and Red Sea is perhaps the more significant pointer to efforts to pursue diplomatic dialogue. However, Black Sea area attacks continue relentlessly, with calls for a halt to attacks on energy and shipping infrastructure continuing to fall on deaf ears.

While the geopolitical focus shifts to tomorrow’s US/China summit, the focus for today is on the run of flash PMIs, another rush of central bank speakers, rate decisions in Indonesia and South Africa, and sharply divergent trends in crude and refined products, as the threat of a US diesel export ban has prompted a renewed surge in ICE Gasoil and adds to concerns about European gas stocks going into the winter.

There is also likely to be a great deal of market chatter about the massive gap that has opened up between US WTI, which is toying with a break below $90.0, and Brent Crude, still only just below $100. One explanation cited by market participants is that, with Saudi Arabia’s East-West pipeline re-opening and ostensibly rather more effort directed towards US/Iran diplomacy, demand for US crude may ease as flows pick up from the GCC.

But, as has been seen on so many occasions since the start of the conflict, this can change very rapidly and, as importantly, the sharper WTI down move may simply reflect greater pressure from speculative stop-loss selling.

Flash PMIs

The rebound in Indian manufacturing and services PMIs after a protracted setback goes some way to alleviate concerns about a sharper loss of momentum, though hard data (GDP/GVA, output and exports) has painted a much more robust growth profile than surveys have implied this year.

But the real surprise was the sharp rebound in Eurozone Services PMIs, accompanied by continued strength in Manufacturing, with orders (particularly exports) seeing a marked upturn. Price indices also turned higher, but remain well below the peaks seen in the aftermath of the initial US & Israel attacks on Iran.

However, outlooks deteriorated on the month, which, given rising price pressures and political turmoil in France and Germany, is unsurprising. UK readings were a tad lower on the month, but broadly in line with expectations, with price indices edging up. In contrast to the Eurozone, overall business optimism held steady at a six-month high.

Per se, this points to continued resilience in Europe as a whole despite political headwinds.

In the US, a marginal setback is expected for the Manufacturing PMI to a still-solid 53.7, with the Services PMI seen dropping back to a still-robust 55.8, having surged from March’s 49.8 to 56.5 in August, and as such little more than a small mean reversion.