Global Stocks Higher as Investors Await Key U.S. Inflation Data

Asian and European markets edge up while dollar steadies, with traders closely following U.S. economic signals and central bank meetings this week.

Equity markets across the globe saw cautious gains on Monday as investors geared up for crucial U.S. inflation data and several central bank meetings that could shape the trajectory of interest rates worldwide.

Stocks Climb Ahead of Inflation, Fed Decisions

Shares in both Asian and European markets closed higher Monday, with the MSCI World Index adding 0.2% and Japan’s Nikkei 225 jumping 1.1%. European stocks also posted modest gains as the pan-European STOXX 600 index rose 0.3%. Investors are closely watching upcoming U.S. consumer price index (CPI) data, scheduled for release this week, which is expected to provide crucial insight into whether the Federal Reserve will cut rates later this year.

“The global investment community is laser-focused on this Wednesday’s U.S. inflation report and the subsequent Federal Reserve policy meeting,” said Simon French, chief economist at Panmure Gordon, in a note to clients. “Inflation persistence remains the central risk for markets.”

Dollar Steadies Amid Rate Speculation

The U.S. dollar held steady on Monday in anticipation of the economic data, with the dollar index flat at 104.9. The currency had dropped sharply at the end of last week after a mixed U.S. jobs report clouded the outlook for the Fed’s next move.

“We’re seeing some hesitancy in the currency markets with traders waiting for direction on U.S. inflation and central bank signals,” said Jane Foley, head of FX strategy at Rabobank. “A surprise in the CPI figure could swing expectations significantly.”

Global Markets React to Economic Crosswinds

Stock indices in Asia-Pacific followed Wall Street’s advance from Friday, buoyed in part by tech stocks and ongoing optimism about artificial intelligence trends. Hong Kong’s Hang Seng Index rose 0.7%, and China’s blue-chip CSI 300 index inched up 0.2%.

Meanwhile, in Europe, some of the optimism was tempered by the European Central Bank’s (ECB) cautious language after last week’s rate cut. Investors are parsing signals from central bankers as inflation in the eurozone remains higher than policymakers’ preferred target.

Central Bank Meetings in Focus

The U.S. Federal Reserve, Bank of Japan (BOJ), and Bank of Canada are all set to deliver policy decisions this week.

Federal Reserve: No change is expected in June, but traders are increasingly divided on the timing and extent of future rate cuts.

Bank of Japan: While the BOJ is not expected to alter policy rates, analysts are looking for hints about plans to further unwind its ultra-loose monetary settings.

Bank of Canada: Policymakers cut rates last week, drawing attention across G7 economies.

“A synchronized move by major central banks could signal a new phase in the global rate cycle,” noted Silvia Dall’Angelo, senior economist at Federated Hermes.

Bonds and Commodities Take Center Stage

Bond yields oscillated in a narrow band Monday. The U.S. 10-year Treasury yield edged down to 4.41%, as investors hedged bets ahead of economic data and policy meetings. German Bund yields slipped to 2.59%.

In commodities, oil prices dipped after last week’s rally, with Brent crude trading at $81.03 per barrel and U.S. West Texas Intermediate (WTI) at $76.83.

Investors Tread Cautiously Amid Uncertainty

With inflation data and policy announcements looming, markets are expected to remain volatile throughout the week. Investors will also monitor the G7 summit in Italy for any geopolitical developments that could influence global energy and trade flows.

“The combination of inflation uncertainty and central bank messaging is creating a cautious mood,” said Richard McGuire, strategist at Rabobank. “Everyone’s waiting for a clearer signal before making big moves.”

Key Data Points to Watch This Week

U.S. Consumer Price Index (CPI): Release expected Wednesday. Analysts forecast headline CPI to ease slightly to 3.3% year-on-year.

U.S. Federal Reserve Policy Meeting: Decision and updated economic projections due Wednesday.

Bank of Japan Policy Meeting: Announcement due Friday.

G7 Leaders Summit: Begins Thursday in Apulia, Italy.

Outlook

With investors treading water ahead of major economic and policy decisions, market volatility could spike if inflation readings surprise or central banks alter their messaging significantly. Analysts caution that while the underlying tone is cautiously optimistic, the direction of central bank policies in the second half of 2025 remains far from settled.

Sources Used:

Reuters: Global Markets Wrapup

Bloomberg: Market Data (retrieved June 9, 2025)

Financial Times: Central Bank Preview

Statements and notes from Panmure Gordon, Rabobank, Federated Hermes