TARIFFS: Swiss Government Signals New 15% US Tariff Rate, More Details To Follow

Spanish final September HICP confirmed flash estimates at 3.04% Y/Y (vs 2.70% prior), the highest rate since June 2024. HICP ex energy and unprocessed foods continued its recent gradual upward trajectory with a fourth consecutive acceleration, at 2.47Y/Y (highest rate since April, vs 2.42% prior) on the back of both higher services and industrial goods (excl. energy) inflation.

• Energy inflation rose to 6.24% Y/Y (3.18% prior) after the flash press release indicated that fuel and electricity prices were an upward driver for headline in September.
• Services inflation was only marginally higher this time, at 3.74% Y/Y (3.72% prior), its second highest rate since last June.
• Industrial goods excluding energy products also climbed upwards (0.33% September vs 0.21% prior), for the second consecutive time, but on a broader view, the category is continuing its sideways trend at around 0.2-0.3% Y/Y since last November .
• Our HICP breadth tracker shows marginal inflationary tendencies for September, with the share of categories printing below 1% Y/Y at 34% (36% prior) at the lowest since February 2024, while the share of categories above 5% Y/Y was unchanged at 17%.

A meeting between the leaders of the libertarian-federalist Japan Innovation Party (Ishin) and governing Liberal Democratic Party (LDP) President Sanae Takaichi may increase the chances of a governing coalition that could ensure Takaichi's election as PM on 21 October. Ishin leader and Osaka Governor Hirofumi Yoshimura said that Takaichi had asked for support in the Diet vote to elect a new PM, with the prospect of forming a governing coalition. 

• Yoshimura said that Takaichi, Ishin co-leader Fumitake Fujita and their respective policy chiefs will hold a meeting tomorrow at 15:00JST (02:00ET, 07:00BST), outlining that policy agreements must come before any PM confirmation/coalition talks. The Ishin leader said that if terms can be reached, it would be for a coalition gov't, not Ishin propping up a minority LDP administration.
• Adds that he believes both parties have an alignment on fundamental national policies, and that Takaichi seemed open to addressing Ishin's key issues, such as a reduction in the social insurance fee, and the vision of a second national capital city.
• Fujita said Ishin lawmakers will discuss the prospect of backing Takaichi and a coalition at a party meeting taking place at 08:00JST (19:00ET, 00:00BST) on 16 Oct.
• Yoshimura confirms that talks with the other opposition parties will continue at the same time as the LDP talks, and that policy disagreements between the Constitutional Democratic Party and Democratic Party for the People is hindering work towards a joint PM candidate. Indeed, Asahi now reports Takaichi as 'likely to be elected PM'. 

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