Inflation Data, Oracle Earnings and Apple's New CEO Test Define Holiday-Shortened Trading Week

Wall Street is back at its desks after Labor Day, and it's walking straight into the most consequential data dump of the month.

CPI and PPI Set the Table for the Fed

Thursday brings the August Producer Price Index. Friday brings the Consumer Price Index. Both land ahead of the Federal Open Market Committee's September 15-16 meeting, and both will decide whether Federal Reserve Chairman Kevin Warsh gets the ammunition he wants for a rate hike.

Economists expect headline CPI to rise 0.4% month-over-month in August, up from a mere 0.07% in July, according to ZeroHedge. Core CPI is expected to come in around 0.2% month-over-month, roughly flat with July's 0.22%. On an annual basis, that would leave headline inflation stuck at 3.4% while core inflation ticks down 10 basis points to 2.4%.

PPI matters just as much. ZeroHedge reports economists expect the producer data to imply a 0.3% month-over-month increase in core PCE, up from 0.2% in July, which would push the annual rate to 4.6% from 4.2%. Higher gasoline prices are expected to lift the headline number, while shelter costs are supposed to keep moderating. ZeroHedge notes Case-Shiller data shows shelter costs turning higher again, which matters if shelter reaccelerates. If it does, the "moderating inflation" story falls apart fast.

Traders aren't betting on a cut. The CME Group's FedWatch tool has markets pricing roughly a 60% chance of a rate hike at the September meeting, according to CNBC. That's a sharp turn from where sentiment sat before Warsh's remarks at the Jackson Hole symposium, which CNBC says pushed hike odds higher on perceived tough talk about inflation.

Fed Governor Christopher Waller tried to talk markets down from the ledge last Thursday at a Reuters-hosted event. Per a transcript posted by the Fed and cited by CNBC, Waller said the labor market is "stable, with employment near its maximum sustainable level," and that inflation is "making slow but continued progress" toward the Fed's 2% target. His actual message was conditional: hold rates if inflation keeps cooling, hike if it comes in hot. CNBC reports the market initially greeted Waller's comments cheerfully, shifting hike odds to a 50-50 toss-up and fueling a stock rally, only for Friday's stronger-than-expected jobs report to reverse that shift. Whether optimism survives Friday's CPI print is what matters this week.

Michigan Sentiment and the ECB

Friday also brings the preliminary University of Michigan consumer sentiment survey. ZeroHedge reports economists expect the reading to fall to 51.0 from August's 51.7, with inflation-expectations components drawing particular attention. A reading in the low 50s is historically weak and shows that ordinary households, not just bond traders, are still bracing for prices to keep climbing.

Overseas, the European Central Bank meets Thursday. ZeroHedge reports Deutsche Bank economists expect a 25 basis point hike, pushing the deposit rate to 2.50%, with an additional hike penciled in for December. Deutsche Bank has also upgraded its 2026 and 2027 eurozone growth forecasts. China's August trade balance, due out this week, is expected to show exports and imports both growing around 27% to 29% year-over-year, according to ZeroHedge, a number that would suggest global trade is holding up better than the tariff-and-slowdown narrative implies.

Oracle, Adobe and Apple's New Boss

On the corporate side, Oracle reports earnings Tuesday, according to Yahoo Finance, which frames the report as a test of whether corporate cloud and AI spending is holding up under higher rates. Oracle's cloud infrastructure adoption and AI-related revenue will be closely monitored, per Yahoo Finance, which notes strong results could ease concerns about enterprise technology weakness, while disappointing numbers would validate concerns about customer budget constraints. Adobe reports Thursday. Wednesday and Thursday also bring back-to-back Treasury bond auctions — a 10-year note auction and a 30-year bond auction — that will test investor appetite for longer-duration debt, per Yahoo Finance.

Apple holds its annual hardware launch event this week, branded "surprise and shine" according to CNBC, and it will double as the first event at the helm for new CEO John Ternus, who replaced Tim Cook on September 1; Cook has moved into an executive chairman role. CNBC reports expected updates include a new iPhone 18, updates to the Apple Watch, new AirPods, and possibly new smart-home offerings, with widespread belief that Apple will enter the foldable smartphone market. Bloomberg News has reported the foldable phone's price is expected to be well north of $2,000, and market research firm IDC expects Apple to ship more than 17 million foldable iPhones by 2027. CNBC also notes a key open question is where Apple prices the iPhone 18 lineup given what Cook called the "100-year flood" of soaring memory costs.

A rate hawk would fairly raise one concern: a 60-40 market lean toward a hike isn't a settled outcome. If Friday's CPI comes in soft, that probability could flip fast, and traders betting on tightening could get burned. The counterargument is that shelter costs and gasoline prices are already showing signs of turning higher, which is exactly why Waller himself hedged his own comments last week.

What happens next is straightforward: Thursday's PPI, Friday's CPI, and then days later, the Fed's actual decision on September 16.