The Week Ahead: August 17th to August 23rd, 2026

Intelligence for the Considered Investor

The Week Ahead

17 to 23 August 2026

Good morning. Here is what we are watching this week.

With the Federal Reserve silent until Jackson Hole next week, the inflation test crosses to Britain, where Wednesday's figures could harden the Bank of England's case for a rise.

The Burnham government's second month opens with the calendar, for once, working against the Treasury rather than for it. Two releases this week, unemployment on Tuesday and inflation on Wednesday, will frame the autumn Budget that John Healey has now fixed for 28 October, and neither is likely to make his task easier. The ten-year gilt yield climbed back above 5 percent last week, touching 5.04 percent and still the highest in the Group of Seven, and it did so before either number landed. A bond market that sells first and reads afterwards is not one a new Chancellor can afford to surprise.

Thames Water remains the sore that will not close. More than a hundred members of Parliament have now signed a letter demanding the company be placed into special administration, and the mood hardened further over the disclosure that its finance chief was handed a signing-on payment of around a million pounds while the firm warns it may run out of cash. The company itself concedes, in its own annual report, that special administration is a real possibility whether a rescue is struck or not. Burnham has kept his options open for a month, and the price of that patience is a slow drip of headlines that make eventual nationalisation look less like a rescue than a reward for failure.

The oil price has changed its mind again. Brent, which spent early August drifting down toward 80 dollars, is back above 88 after Washington warned that its naval blockade of Iranian ports could run indefinitely and floated the economic isolation of Iran as the price of a deal. The Strait of Hormuz is the same argument it has been all summer, only the direction of travel has reversed: the talk now is of tightening the screw rather than reopening the lane. For an inflation picture that had only just begun to breathe, a barrel heading back up at the wrong moment is an unwelcome complication.

It complicates a debate the American data has otherwise left unresolved. July consumer prices came in at 3.4 percent, a shade below June and roughly as expected, stubborn without being alarming. Set against a jobs report that showed payrolls actually falling, that leaves the Federal Reserve's September decision genuinely open: the case for a hike has faded to about four chances in ten, while a cut is not yet nailed on either. The minutes of the July meeting, out on Wednesday, will show how the three dissenters justified wanting to go higher, though they record an argument the newer data has already moved past.

One front will settle this week. Trump's 50 percent tariff on some 16 billion dollars of Canadian goods takes effect on Wednesday, and this time without the exemption for goods that comply with the North American trade pact, an escalation Ottawa had bet would be softened. For the signal that actually matters, though, the market must wait. Chair Warsh gives his first Jackson Hole address next Friday, the 28th, and until he does, everything said this week is prologue.

Germany holds a state election in Saxony-Anhalt on 6 September, and the campaign now entering its final fortnight is watched far beyond the state's borders. The Alternative for Germany is polling at around 41 percent, roughly double its 2021 result and within reach of an absolute majority in a regional parliament, something no party of the hard right has achieved in postwar Germany. The Christian Democrats, who currently run the state, trail in the low twenties. On these numbers the arithmetic of the mainstream's cordon sanitaire, the refusal of the other parties to govern with the AfD, begins to buckle under its own weight.

An outright majority would not hand the AfD the chancellery, and Saxony-Anhalt is a small state of modest economic weight. The significance lies in the precedent. A party the domestic intelligence service has placed under formal observation, winning a regional parliament outright, would force every other party to choose between abandoning the firewall and governing around a plurality they cannot wish away. Federal politics has spent three years insisting the question would never arrive. It is now three weeks off.

Set beside the last month's news from Warsaw and Stockholm, the pattern is hard to miss. The European nationalist right is advancing through three different doors at once: paralysing a government by presidential veto in Poland, accepting an invitation into coalition in Sweden, and now bidding for an outright majority in eastern Germany. The long argument about how to keep it from power is quietly being overtaken by a harder one about what to do once it holds some.

Indonesia: Holding the Line on the Rupiah

Bank Indonesia meets this week and is expected to leave its policy rate at 5.75 percent, extending a defensive stance it has held all summer. The central bank raised rates three times earlier in the year, one of them an off-cycle move, purely to protect the rupiah as the oil shock and a firm dollar pulled capital out of the region. It would like to cut, to support a slowing economy, but the currency will not let it. Indonesia is the clearest case this week of a wider bind: for an energy importer with a fragile currency, the barrel turning back up in the Gulf arrives as an interest-rate problem thousands of miles away.

Argentina: The Scandal Milei Was Meant to End

Javier Milei built a presidency on a single promise, to break la casta, the self-dealing political class. A run of corruption scandals is now turning that promise against him. His cabinet chief has been pressed to explain a lifestyle his state salary does not obviously cover, and an earlier bribery affair, caught on leaked audio, reached as far as the president's own sister and chief of staff. Milei's disapproval has climbed above 60 percent, and the markets have taken note: the peso has slid toward the weak edge of its managed band, dollar bonds have fallen, and local borrowing costs have spiked in a liquidity squeeze. With no national election due until 2027, his government has time to recover its footing. But the man who ran against the venality of the political class is finding the charge far harder to answer once it is aimed within.

United Kingdom

Consumer Prices, Wednesday 19 August, with the labour market on Tuesday. The week's centrepiece. June inflation fell to 2.6 percent, a fifteen-month low, but July is expected to give much of that back as the 13 percent rise in the household energy cap feeds through, lifting the rate toward 3 percent. Tuesday's jobs figures set the backdrop: unemployment has drifted up to 4.9 percent and pay growth has cooled, the softening the Bank of England's doves point to. Rising prices into a weakening jobs market is the same uncomfortable mix troubling Washington, now arriving in London.

Global

Flash Purchasing Managers' Indices, Friday 21 August. The first read on activity across the United States, the eurozone and Britain in August, and the earliest gauge of whether the new wave of tariffs is denting output or merely lifting prices. July had the eurozone composite back in expansion and American services holding up; August will show whether that survived the summer's trade escalation.

Japan

Consumer Prices, at the end of the week. Inflation has run above the Bank of Japan's target for many months, and another firm reading would harden the case for the rate rise the market expects in September. The detail to watch is services prices, the Bank's preferred evidence that inflation has turned domestic and durable rather than imported.

Corporate attention turns from the technology giants to the shop floor. Three of America's biggest retailers report within three days, and together they are the clearest read on hand of whether the consumer is still spending as the jobs market cools.

United States

Home Depot (HD). Second-quarter results before the open on Tuesday 18 August.

Expected earnings per share: approximately 4.71 dollars, broadly flat on a year earlier. Sources: company guidance, MarketBeat.

Home Depot reads on the big-ticket end of the consumer, the kitchens and extensions households postpone the moment they feel less secure. With mortgage rates stuck near 5.6 percent and the housing market becalmed, the interest is in whether Americans are still willing to spend on their homes or have started to wait. It is the most interest-rate-sensitive of the week's three reports.

Target (TGT). Second-quarter results before the open on Wednesday 19 August.

Expected earnings per share: approximately 2.32 dollars. Sources: company guidance, MarketBeat.

Target sits at the discretionary end that Walmart's groceries do not reach, which makes the gap between the two the most revealing number of the week. A firm Walmart and a soft Target would describe a shopper who is still spending, but only on what they cannot avoid. Deere reports the same week for the farm and industrial side of the same question.

Walmart (WMT). Second-quarter results before the open on Thursday 20 August.

Revenue estimate: approximately 187 billion dollars. Expected earnings per share: approximately 0.74 dollars. Sources: company guidance, TipRanks.

Walmart is the single best gauge of the American shopper, and in a softening economy it tends to win twice, keeping its own customers and gaining wealthier ones trading down to it. The results will say less about Walmart than about the mood of the household, and strong grocery volumes alongside cautious discretionary spending would be the signature of a consumer growing careful. The guidance for the second half will matter more than the quarter itself.

Results, market reaction and the Clarmond view.

Applied Materials  AMAT · Reported Wednesday 13 August

−5% after hours. A record quarter and a strong outlook, sold anyway on a softer margin line.

We called Applied Materials the supplier's-eye view of whether the orders were still arriving, and they were: record revenue, a fifth straight beat, guidance above the Street. The stock fell five percent regardless. The equipment makers are now in the same trap as the chip designers, where only flawless will do, and a strong quarter with a soft margin is filed under disappointment.

Cisco  CSCO · Reported Wednesday 12 August

−4% after hours. A beat and a raise, with artificial-intelligence infrastructure orders of 9.3 billion dollars, sold off all the same.

Cisco did everything asked of it: beat the quarter, raised the year, and pointed to 9.3 billion dollars of artificial-intelligence infrastructure orders. The shares fell anyway. The verdict matched Applied Materials the next day and AMD the week before, which is that the market has stopped paying up for good news in technology when the price already assumes it. What began as healthy discrimination is starting to look like outright suspicion.

Aviva  AV. · Reported Thursday 14 August

Steady. The Direct Line integration and a 20 percent return on equity did the talking.

We said an insurer quietly compounding its dividend was the sort of holding that does its work while the macro argument rages overhead, and Aviva obliged, with operating profit up almost a quarter and the interim dividend lifted 7 percent. No drama and no sell-off, just a well-run business paying its owners more. In a week when the market punished two excellent technology beats, the dull compounder was the one that kept its ground.

This is a week of waiting dressed up as a week of data. The two numbers that might have settled the American argument, inflation and jobs, are already in, and between them they have settled nothing: prices stubborn at 3.4 percent, payrolls actually shrinking, and a Federal Reserve whose September move is now close to a coin toss. Everything printed this week, the July minutes, the flash surveys, the run of retail results, fills the silence until the one voice that matters breaks it. Chair Warsh speaks at Jackson Hole a week on Friday, and the market has, sensibly, chosen to wait for him.

In the meantime the inflation story crosses the Atlantic. Britain's consumer prices on Wednesday are expected to climb back toward 3 percent as the energy cap bites, landing on a Bank of England that already has three members itching to raise and on a gilt market charging the highest yield in the Group of Seven. The awkward combination that has defined the American summer, prices firming while the labour market softens, is now Britain's to manage as well, and with far less fiscal room to soften the blow. Add an oil price that has turned back up on the threat of a tighter blockade, and the disinflation everyone was counting on for the autumn looks a good deal less certain than it did a fortnight ago.

The political backdrop offers no reassurance. In eastern Germany a party under state surveillance is within reach of governing a region outright, the clearest sign yet that Europe's argument about the nationalist right has shifted from how to keep it out to what to do once it is in. For markets, though, the near term narrows to a single man and a single speech. Warsh has reportedly called his Jackson Hole text a blank sheet of paper. Rarely has a blank sheet been awaited by so many with so much resting on what comes to fill it.

With best wishes,
Chris and Mustafa at Clarmond
clarmond.co.uk