Sep 25, 2026 · 50 min
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Markets weigh rate risks from US inflation to Australia’s housing squeeze
Daybreak Weekend: US Jobs, Burnham Conference, RBA Decision
The episode connects the week’s data, political pressures, corporate earnings, and infrastructure spending to a broader question about how higher rates reshape growth.
- 1US payrolls and inflation data could revive expectations for additional Federal Reserve rate hikes.
- 2UK Labour faces a constrained budget, bond-market scrutiny, and a more fragmented political landscape.
- 3Australia’s rate outlook, housing weakness, and AI infrastructure boom collide with persistent inflation and power constraints.
Don't miss
James McIntyre connects Australia’s rate outlook and housing weakness with the financing and power constraints facing its AI infrastructure boom.
The brief
Nathan Hager and international anchors frame a week dominated by US jobs and inflation data, UK Labour’s conference, and Australia’s interest-rate decision.
Edward Harrison argues that strong US activity and elevated inflation could push markets to price additional Federal Reserve hikes, making payrolls and PCE data pivotal.
Judy Lagrou previews earnings from Carnival, Micron Technology, and Nike, spanning resilient travel demand, AI-driven memory-chip demand, and a difficult turnaround.
UK Labour’s conference arrives before a constrained budget, with bond-market concerns, limited fiscal headroom, and a fragmented party system complicating the government’s choices.
James McIntyre links Australia’s persistent inflation and mortgage pressures to the RBA’s rate outlook, then examines whether power constraints and financing costs can slow its AI buildout.
The episode’s central tension is Australia’s attempt to attract data-center and AI investment while higher rates pressure households, housing, and the cost of development.
What was said on this episode
18 statements · 1 positive · 13 negative · 2 mixed · 2 neutral
U.S. economic data will likely be strong, pushing bond yields higher.
“this week, we should be looking for strength, and that strength potentially having a negative effect on the bond market in particular by sending yields higher.”
Listen at 3:57
August PCE inflation will exceed 3% but may undershoot consensus.
“my expectation is definitely it will be above 3, but there is more risk that it goes lower than the consensus has right now.”
Listen at 4:44
Core and headline PCE inflation will remain above 3%.
“both the core and the headline number are going to be above 3%.”
Listen at 5:30
Markets may fully price an October hike and possibly hikes in October and December.
“that pricing could move up from 2/3 price to a fully priced and perhaps even pricing in both a rate hike in October and December.”
Listen at 6:24
A very strong economy may make inflation more entrenched.
“the potential is that the economy is so strong that inflation has become more embedded”
Listen at 7:18
The U.S. economy is near overheating, harming inflation and bonds.
“that shows you an economy that's hot, almost to the point of overheating. And that's negative, obviously, for inflation. And it's also negative for bonds.”
Listen at 7:59
Carnival’s stock has fallen about 30% this year.
“Carnival is— the stock itself is down about 30% this year.”
Listen at 9:18
Royal Caribbean agreed to acquire half of Sandals for about $3 billion.
“Royal Caribbean this week agreed to buy a 50% stake in Sandals for about $3 billion.”
Listen at 10:16
AI demand is causing memory-chip shortages, benefiting Micron.
“AI demand is really driving the shortage of memory chips. So Micron is on the winning side of that.”
Listen at 11:42
Nike is on pace for its worst year since 1993.
“Nike, ticker NKE, right? The sneaker company is on pace, Nathan, to have its worst year since 1993”
Listen at 12:52
UK bond-market moves reduced fiscal headroom to roughly £10 billion.
“The bond market moves now have halved that. And so we are back near, according to most estimates, including Bloomberg Economics, that low figure.”
Listen at 27:42
UK politics is currently highly fragmented.
“UK politics is totally fragmented.”
Listen at 29:14
Five English parties each poll around 20%, within five points of one another.
“We now have 5 parties: Labour, the Conservatives, Reform UK, Liberal Democrats, and the Greens. Not even getting into the SNP, if we're just keeping it in England, who all poll within about 5 percentage points of one another, around 20%.”
Listen at 29:29
The RBA will deliver another rate hike this week.
“I think that the RBA is going to deliver another rate hike this week.”
Listen at 35:54
Australian house prices will likely decline sharply again in September.
“The September data is likely to show that we've got another large month-on-month decline in house prices”
Listen at 41:16
Australian housing construction and consumer spending will weaken through 2027.
“This, this part of the economy will be weakening and weakening further through the remainder of 2026 and into 2027”
Listen at 42:16
Fuel prices will add about 70 basis points to monthly Australian inflation.
“there is going to be a big boost to the month-on-month inflation from fuel prices. I estimate about 70 basis points in the month”
Listen at 43:02
Another RBA rate hike in November is uncertain.
“Whether it justifies the RBA moving again in November is much less certain in my view.”
Listen at 43:34
Statements are attributed to the speaker as said on the episode and reflect their view at the time, not PodLume's. They are not advice.