The Week Ahead: US August PCE and September Nonfarm Payrolls Take Center Stage, Micron Earnings in Focus

TradingKey - In the coming week (September 28 to October 2, ET), US markets will face the most concentrated macroeconomic data window from late September to early October. The US August PCE price index, September nonfarm payrolls report, ADP employment, JOLTS job openings, and ISM manufacturing index will be released in succession, providing the latest basis for the market to assess the Federal Reserve's next interest rate path.

The Federal Reserve raised interest rates by 25 basis points at its September 16 meeting, raising the target range for the federal funds rate to 3.75%-4.00%, marking its first rate hike in three years. The latest economic projections show that the median forecast of FOMC members for the federal funds rate at the end of 2026 is 4.1%, implying that whether policy will be further tightened within the year still depends on subsequent inflation and employment data.

Therefore, the core PCE data released next Wednesday and the nonfarm payrolls report on Friday will be the two most important data points for the market. If inflation continues to run above the Fed's target while the labor market remains strong, the market may again raise expectations for further rate hikes within the year. If PCE cools and job growth slows significantly, US Treasury yields and the US dollar may come under pressure, while high-valuation tech stocks could receive some support.

On the corporate front, memory chip giant Micron Technology (MU) will report its fourth-quarter fiscal 2026 results after the market close on Wednesday; sportswear giant Nike (NKE) will release its first-quarter fiscal 2027 earnings report after the market close on Thursday.

Major Events Preview

U.S. August Core PCE Data Released: Expectations for Fed's Next Rate Hike Face Key Test

On Wednesday (September 30), the U.S. Bureau of Economic Analysis will publish August personal income, personal spending, and PCE price index data, alongside the third estimate of second-quarter GDP. The PCE report will be released at 8:30 a.m. Eastern Time.

In July, the overall U.S. PCE price index rose 3.7% year-over-year, while core PCE rose 3.3% year-over-year, both remaining significantly above the Fed's 2% long-term inflation target. On a month-over-month basis, both overall and core PCE rose 0.2%.

Market consensus currently expects overall PCE to increase by 0.4% month-over-month in August, with core PCE rising 0.3% month-over-month. Barring significant revisions to historical data, overall PCE is expected to rise to around 3.8% year-over-year, and core PCE to around 3.4% year-over-year.

With the Federal Reserve having recently completed a rate hike, the significance of this PCE release is heightened. If core PCE continues to accelerate, particularly with sustained pressure on service prices, the likelihood of another Fed rate hike in October or by year-end could rise, potentially lending support to U.S. Treasury yields and the U.S. dollar.

It is worth noting that the BEA will simultaneously perform annual updates to the National Economic Accounts with this release, including historical data for GDP, personal income, and consumption. Consequently, beyond focusing on August single-month data, the market will also need to watch for potential major revisions to past inflation and spending figures.

September Nonfarm Payrolls Take Center Stage: Can the Labor Market Extend Its August Rebound?

On Friday (October 2), the U.S. Bureau of Labor Statistics will release the September nonfarm payrolls report, including data such as nonfarm payroll additions, the unemployment rate, the labor force participation rate, and average hourly earnings. According to the official schedule, the report will be released at 8:30 a.m. Eastern Time.

U.S. nonfarm payrolls increased by 162,000 in August, significantly exceeding market expectations, while the unemployment rate remained at 4.1%. Average hourly earnings rose 0.3% month-over-month and 3.1% year-over-year. Meanwhile, employment figures for June and July were revised upward by a combined 55,000, indicating that prior labor market weakness was less severe than initially reported.

Therefore, the September data will help the market determine whether the August employment rebound was merely a temporary phenomenon or the beginning of a renewed labor market recovery.

If payroll gains remain robust alongside accelerating wage growth, it will bolster the case for further Fed monetary tightening. Conversely, if payroll growth slows significantly and the unemployment rate rises, market expectations for another rate hike could cool.

Micron Earnings Highlighted as Demand for HBM and AI Memory Faces Further Validation

On Wednesday (September 30) after market close, Micron will release its fourth-quarter fiscal 2026 financial results and host an earnings conference call at 4:30 p.m. Eastern Time. The company has officially confirmed the earnings date.

In the previous fiscal quarter, Micron reported revenue of $41.46 billion, up from $23.86 billion in the prior quarter, non-GAAP EPS of $25.11, and operating cash flow of $25.39 billion. The company previously guided fourth-quarter revenue to be approximately $50 billion, plus or minus $1 billion, and non-GAAP EPS of approximately $31, plus or minus $1.

The market will focus heavily on prices for HBM, DRAM, and NAND, as well as memory demand driven by AI servers. As Micron has already begun mass shipments of HBM4 and is advancing HBM4E research and development, management's commentary on 2027 AI memory demand, capacity expansion, and capital expenditures may prove more critical than single-quarter earnings figures.

Amid heightened volatility in the AI chip supply chain recently, if Micron's fourth-quarter results and guidance for the following quarter continue to show strong growth, it will provide fresh fundamental validation for AI server and memory chip demand. Conversely, if growth in pricing, orders, or gross margins begins to decelerate, the market may re-evaluate the duration of the current memory chip upcycle.

Core Schedule for the Week

Monday (September 28)

Key Events: September Dallas Fed Manufacturing Index

The U.S. will release the September Dallas Fed Manufacturing Survey, providing the latest reference for observing U.S. manufacturing activity, new orders, output, and corporate costs.

Tuesday (September 29)

Key Events: August JOLTS Job Openings, September Conference Board Consumer Confidence

The U.S. will release August JOLTS job openings, the September Conference Board consumer confidence index, and the July Case-Shiller home price index.

Among them, JOLTS will be the first to test whether corporate hiring demand remains stable, while consumer confidence reflects households' latest assessment of employment and economic prospects.

Wednesday (September 30)

Key Events: August Core PCE, Micron Earnings

The U.S. will release the August PCE price index, personal income, and personal spending, as well as the third estimate of Q2 GDP.

The September ADP private sector employment data will also be released on the same day, along with preliminary figures for August goods trade and inventories.

After U.S. market close, Micron will report its fiscal fourth quarter 2026 earnings, with HBM, DRAM, and NAND prices, alongside guidance for the next fiscal quarter, serving as the core focus for the semiconductor sector.

Thursday (October 1)

Key Events: September ISM Manufacturing, Nike Earnings

The U.S. will release the September ISM Manufacturing Index and August construction spending, as well as initial jobless claims for the week. The U.S. Census Bureau has confirmed that August construction spending will be released on October 1.

The New Orders, Employment, and Prices Paid indexes in the ISM report will be key focal points. If manufacturing growth remains above 50 while price pressures stay elevated, it could strengthen market expectations that the Federal Reserve will maintain its tight monetary policy.

After U.S. market close, Nike will report its fiscal first quarter 2027 results, with investors focusing on sales recovery, the Direct business, gross margin, and management's updated full-year demand outlook.

Friday (October 2)

Key Events: U.S. September Nonfarm Payrolls, September Unemployment Rate

The U.S. will release the September nonfarm payrolls report, one of the final and most critical market events of next week. The data will be released at 8:30 a.m. ET.

The market will focus on job growth, the unemployment rate, and average hourly earnings, while combining these with previously released JOLTS and ADP data to assess the true state of the U.S. labor market.

The U.S. will also release August factory orders on the same day, providing further reference for business equipment and manufacturing demand. The U.S. Census Bureau has scheduled the data release for October 2.