The Week Ahead: Trump-Xi meeting, Fed leadership transition, Iran and inflation in focus for markets

The situation in the Middle East remains firmly in focus as US President Donald Trump heads to China for a meeting with the country’s leader, Xi Jinping. There’s a changing of the guard at the Fed as Jay Powell’s term ends just as the Senate returns from recess to vote on Kevin Warsh’s appointment. 

Inflation is firmly in focus with a raft of releases, with the highlight Tuesday’s US CPI inflation report for April. 

In the UK there’s the ongoing fallout for the government from the 7 May elections just as the King is due to mark the State Opening of Parliament on Wednesday.

Earnings season is almost over in the US – although Nvidia is the key piece of the puzzle reporting on 20 May – but this week there is plenty of interest in the UK with results from the likes of Vodafone, Burberry and Greggs among others.

Here’s the key events to watch over the next week.

Monday, 11 May

The trading week kicks off with a focus on inflation - Chinese CPI and PPI is first up before German wholesale inflation is released. Cleveland Fed inflation expectations are also slated. 

US Treasury Secretary Scott Bessent is scheduled to visit Japan to meet Prime Minister Sanae Takaichi, while back in the US the Senate returns from recess, with a vote expected sometime this week on a motion related to Kevin Warsh’s nomination as Fed Chair.

Earnings are due up from AST SpaceMobile, Cleanspark, Barrick Mining and crypto stock MARA Holdings. In London contract food service company Compass Group is due to report.

Tuesday, 12 May

The inflation focus continues with German CPI data before the week’s main economic event, the US CPI report. April CPI is expected to rise 0.7% month-on-month, easingfrom 0.9%, while the annual rate is seen heading towards 4% after jumping from 2.4% to 3.3% in March. A 21% jump in gasoline during March was the main culprit and the rise in inflation is making life all the moredifficult for the incoming Fed chair. A 10yr Treasury auction is scheduled after the release.

In APAC, as well as Japanese household spending data and leading indicators report the Bank of Japan publishes its summary of opinions from its April monetary policy meeting, which might give a clearer picture of how near it is to hiking interest rates, which will have a read for yen crosses. Meanwhile Australian Treasurer Jim Chalmers unveils the government’s budget, the first since Labor’s 2025 election win.

In London, FY results from Vodafone, H1 results from Imperial Brands and Q1 sales from IMI and Greggs are the main events on the corporate calendar. This follows the release of the BRC retail sales monitor ahead of the market open, which will drive price action in some of the cyclical retail names on the FTSE 350. Elsewhere, JD.com is due to report earnings.

Wednesday, 13 May

State Opening of Parliament, with King Charles III delivering the King’s Speech outlining the government’s legislative agenda, which takes on added significance following the drubbing taken by Labour in the prior week’s elections. 

Australia’s wage price index and New Zealand inflation expectations data are out overnight, setting the focus on rates and the impact of the war. After this we see the flash Eurozone GDP, industrial production and employment reports at 10am BST. In the afternoon session US PPI data is the main focus. 

Energy markets will continue to be the focus of attention this week as the situation in the Middle East develops and the IEA and OPEC release their monthly oil market reports today.

Central bank speakers will help fill in some blanks on how they see this inflation shock and the likely path for rates. Minneapolis Fed President Neel Kashkari and Boston Fed President Susan Collins are both due to speak, while Bank of England rate-setter Catherine Mann speaks at the London School of Economics on the UK’s “international exposures and vulnerabilities.”

Earnings are due up from Alibaba, Cisco and Nebius, whilst FTSE 100 member Spirax reports Q1 sales. In Europe the focus is on results from German carmakers BMW and Porsche as well as shipping giant Hapag-Lloyd and travel firm TUI - what impact are they all seeing from the war in the Middle East?

Thursday, 14 May

US President Donald Trump visits China for meetings with President Xi Jinping – the conflict in the Middle East, Taiwan, Ukraine, tariffs and AI are among the likely topics in what could be a key moment in the relationship between the two countries.

UK Q1 GDP data is released although any rebound from the subdued end to 2025 is likely to be short-lived as the country grapples with rising inflation and soaring energy costs.

US April retail sales figures will show just how resilient the US consumer can be. March’s +1.7% was largely driven by higher gasoline prices, but the core reading of +0.4% was nevertheless still strong. April’s numbers may suffer due to the war and rising prices. The UoM consumer confidence slid to a record low due to war and inflation anxiety, but the labour market remains robust.

We hear from FOMC members Hammack, Barr and Williams, whilst BoE chief economist and chief hawk Huw Pill is also due to speak.

It’s a busy day for reporting in London with 3i Group, Aviva, Burberry, Landsec, National Grid, Shawbrook, United Utilities and The Magnum Ice Cream Company all due to deliver results. It’s also a monster day for ex-dividends on the FTSE 100 with almost 20pts scrubbed from the index as HSBC, BP, Unilever, GSK, Tesco, Pershing Square, Coca-Cola HBC all trade ex-dividend.In the US, the only major earnings release is from Applied Materials.

Friday, 15 May

Fed chair Jerome Powell’s term ends, although he has said he may remain on the board until his term as a governor ends in 2028. 

We'll also pay attention to the latest 13F filings, which offer a snapshot of the equity holdings and recent trading activity of many closely watched hedge funds as well as Berkshire Hathaway.

Some data of note includes Japan PPI, machine tool orders; ECB economic bulletin; US Empire State manufacturing index, industrial production and capacity utilization.