The Week Ahead: US rate decision, PCE inflation, Microsoft earnings

Published: Friday, 23 October 2026 at 12.30pm (UK)

It’s set to be one of the busier weeks of the fourth quarter, with the UK Budget announcement likely to be the domestic focus of attention on Wednesday afternoon. The Federal Open Market Committee’s (FOMC) US interest-rate decision is also due later that day, while mega-cap earnings season gets into full swing with big tech giants such as Microsoft, Amazon, and Alphabet all reporting.

US interest-rate decision

Wednesday 28 October

The market is not pricing in a US rate hike at the October meeting and instead expects the next increase to occur in December. Still, this doesn't mean the FOMC can't raise rates at this month's meeting. However, it appears highly unlikely, and would break with established market norms and expectations.

Nevertheless, a hawkish stance or hints of future rate hikes could rattle markets, particularly commodities like gold, which have already been weakening and are now closer to breaking below significant support around $4,000, a level that has been highlighted for some time. If gold finally breaks below $4,000, it could send prices back towards the mid-$3,000s, potentially targeting $3,600 as the next major support level.

Gold, September 2025 – present

Source: TradingView, 22 October 2026

Microsoft Q1 earnings

Wednesday 28 October

Microsoft is expected to report fiscal first-quarter earnings growth of 14.3% year-on-year to $4.72 a share, with revenue forecast to rise 16.8% to $90.1bn. Meanwhile, capital expenditure is expected to rise to $46.6bn from $19.4bn a year ago. For fiscal Q2, analysts expect earnings to grow 16.9% to $4.84 a share, with revenue up 17.6% to $95.6bn. Capital expenditure is expected to rise to $48.4bn from $29.9bn a year ago. The stock is expected to move around 4.7% after the earnings release.

Microsoft's option positioning is extremely bullish, suggesting that after the company reports results and implied volatility declines, hedging flows could weigh on the stock and create selling pressure. Additionally, option positioning shows a significant concentration of call gamma around $575, which may act as resistance, while put gamma indicates a strong support level around $495.

The technical chart shows that Microsoft's stock has moved back towards its all-time highs but has struggled to break above resistance around $550. This marks the third time since 31 July 2025 that the stock has tested that level and failed to break through. Microsoft’s share price is now showing signs of weakness, with support around $520.

However, if the stock continues its recent decline after the results, the next meaningful support is around $495, consistent with options market positioning. A break below that price could expose the stock to significant downside towards $475, or potentially as low as $465. The upside appears somewhat limited: the stock has repeatedly struggled to break above $550, while the significant concentration of call gamma around $575 could also provide resistance.

Microsoft share price, May 2025 – present

Source: TradingView, 22 October 2026

US PCE

Thursday 29 October

Unfortunately for traders and investors, the US September personal consumption expenditures (PCE) report will be released the day after the Federal Reserve’s meeting. It’s expected to be another hot inflation reading: headline PCE is forecast to rise by 0.5% month-on-month, up from 0.3%, while the year-on-year rate is expected to increase to 3.6% from 3.4%. Meanwhile, core PCE is expected to rise by 0.3% month-on-month, up from 0.2%, with the year-on-year rate increasing to 3.1% from 3%.

By the time Thursday’s PCE report is released, markets will have had time to digest the Fed meeting, and the inflation data is likely to add another layer to the market's reaction.

The euro remains vulnerable against the dollar, with EUR/USD sitting close to support around $1.12. If the Fed adopts a more hawkish stance, and the PCE report comes in hotter than expected, the euro could slide towards support around $1.10.

Conversely, if the Fed appears to be more tolerant of the inflation picture, while the PCE report comes in cooler than expected, the euro might rally. The euro-dollar pair could then break above resistance around $1.135 and may potentially move back towards its 50-day moving average, currently around $1.144.

EUR/USD, April 2025 – present

Source: TradingView, 22 October 2026

Economic & company events calendar

Major scheduled data releases, plus selected UK, US and other listed company results:

Monday 26 October

• Germany: Ifo business climate (October)

• Results: Airtel Mobile Commerce (HY), Cadence Design Systems (Q3), Nucor (Q3), Public Storage (Q3), Quadrise (FY), Verizon (Q3), Welltower (Q3)

Tuesday 27 October

• Eurozone: ECB Bank Lending Survey

• UK: BRC shop price index (October)

• US: ADP employment change (4-week average), durable goods orders (September), consumer confidence (October), new home sales (September)

• Results: Boeing (Q3), Coca-Cola (Q3), HSBC (Q3), Luceco (Q3), Reckitt (Q3), Revolution Beauty (HY), RWS (FY), Seagate Technology (Q1), S&P Global (Q3), Visa (Q4)

Wednesday 28 October

• Australia: RBA Governor Bullock speech, consumer price index (September)

• Canada: Bank of Canada interest-rate decision, monetary policy statement & press conference

• Germany: GfK consumer confidence survey (November)

• New Zealand: Reserve Bank of New Zealand interest-rate decision & monetary policy statement

• UK: Autumn Budget

• US: Federal Open Market Committee interest-rate decision, policy statement & press conference

• Results: Alphabet (Q3), Amphenol (Q3), Elementis (Q3), GE Vernova (Q3), GSK (Q3), Intertek (Q3), KLA (Q1), Microsoft (Q1), Standard Chartered (Q3), Unilever (Q3)

Thursday 29 October

• Eurozone: Business climate, consumer confidence, economic sentiment indicator (October), European Central Bank interest-rate decision, monetary policy statement & press conference

• US: Personal consumption expenditures (PCE) price index, personal income, personal spending (September), preliminary gross domestic product (Q3)

• Results: Amazon (Q3), Caterpillar (Q3), Computacenter (Q3), Haleon (Q3), IMI (Q3), Intel (Q3), Lloyds (Q3), Mastercard (Q3), Merck (Q3), St James’s Place (Q3)

Friday 30 October

• Australia: Producer price index (Q3)

• Canada: GDP (August)

• Eurozone: Preliminary GDP (Q3)

• Germany: Preliminary GDP (Q3), preliminary CPI (October), unemployment rate (September)

• Japan: Tokyo CPI (October), unemployment rate, retail trade (September), Bank of Japan interest-rate decision & monetary policy statement

• US: Chicago PMI (October)

• Results: AbbVie (Q3), Airtel Africa (HY), AstraZeneca (Q3), BP (Q3), Chevron (Q3), ExxonMobil (Q3), General Dynamics (Q3), NatWest (Q3), Regeneron (Q3)

Note: While we check all dates carefully to ensure that they are correct at the time of writing, the above announcements are subject to change.

Michael Kramer and clients of Mott Capital Management own shares in Microsoft. This report contains independent commentary to be used for informational and educational purposes only. Michael Kramer is a member and investment adviser representative with Mott Capital Management. He is not affiliated with Microsoft and does not serve on the board of any related company that issued this stock.