News reels around the world will be dominated by war coverage this week as Israel seeks retribution for an unprecedented incursion by Hamas militants over the weekend.

The attack, which came from land, air and sea, appeared opportunistic. Hamas struck at a delicate juncture for Israel, where an unpopular judicial overhaul push continues to sow domestic discord while fanning international concerns about Benjamin Netanyahu’s commitment to democracy.

By Sunday, hundreds were already dead on both sides of what promises to be a protracted, brutal war.

What happens on the macroeconomic front is trivial in the context of widespread human suffering, but market participants will parse an update on consumer prices in the US for evidence to support (or not) another rate hike from the Fed.

Consensus expects 0.3% from the MoM core CPI print, and the same from the headline gauge.

Anything cooler than 0.2% from the core reading would prompt markets to fade the one-in-three odds assigned to a November hike. An in-line print would leave those odds unchanged, and an overshoot would probably push them to a coin toss.

The inflation update will be contextualized not just by last week’s blockbuster nonfarm payrolls print, and perhaps not even mainly by the headline NFP reading. Rather, savvy traders will likely assess the core CPI figures in the context of the “dovish crumbs” from the September jobs report, and particularly back-to-back cool readings for nonsupervisory wages.

Long story short, if core price growth comes in cool, the combination of decelerating price momentum and waning wage pressure among “regular” workers could offset the still brisk pace of hiring when it comes to the Fed’s decision calculus for next month’s policy gathering.

And yet, given dysfunction inside the Beltway, November could be Jerome Powell’s last, best chance to squeeze in another hike before markets are once again bedeviled by the specter of a paralyzed legislature. So, some rate hike premium will remain for November regardless of what happens with the data, and given the dot plot’s nod to another hike, any CPI upside would make a strong case for a higher terminal rate, particularly if retail sales come in hot later this month.

The market backdrop is the ongoing bond selloff. Last week was another tough stretch for the US long-end, and although bonds are deeply oversold, “duration has no friends” (as one popular strategist put it) until the data rolls over. The same is true of any steepening impulse: If the curve steepens, it’ll be “by bear,” so to speak, up to and until the economy cracks, prompting traders to bring forward next year’s cuts and opening the short-end up to a rally.

Although CPI is the marquee macro report, US jobless claims will garner outsized attention given three consecutive rock-bottom initial claims prints which helped underscore the “resilient” labor market narrative at the heart of the Fed’s “higher-for-longer” messaging.

Also on deck: PPI, NFIB, the preliminary read on University of Michigan sentiment for October and the September FOMC minutes, which’ll be parsed relentlessly even as there’s no reason to believe the overarching message has changed. Indeed, a bevy of Fed speakers will pound home some version of a generally hawkish narrative, although you’re reminded there’s no unanimity on the Committee when it comes to hiking again in 2023. Not everyone believes another hike is necessary or even desirable.

Elsewhere, the IMF will release updated projections and trade data out of China is due.