The bond market reached its verdict before the data did. This week the data shows up.

Wednesday at 8:30 a.m. Eastern brings the first official inflation read since yields broke higher. It also brings a new way of measuring it. The Bureau of Economic Analysis is changing how it prices three parts of consumer spending: investment advice, legal services and computer software.

RBC expects the change to take about 0.18 point off core PCE inflation. That would revise July's 3.3% to about 3.1%. RBC also warns against reading a softer Wednesday print as a sign of cooling.

So the question entering the week is plain. Will the market mistake a new ruler for a cooler economy? Friday's jobs report answers the other half.

Friday at midday set the board. The 10-year traded near 5.20%, about 20 basis points above the prior Friday's close. The 30-year sat near 5.51%. The 2-year closed Thursday at 4.87%.

The S&P 500 traded near 7,713. WTI was near $94 and Brent near $106.

Futures priced about a two-thirds chance of an October hike Friday morning. Four more hikes are priced by June 2027. The next decision is October 28.

Last Sunday's tests have answers now. The five-year auction cleared at 5.033%, the highest since 2006. Core capital goods orders rose 1.6% in August. We said a soft print would show the demand story had a limit. It showed none.

A NEW RULER FOR INFLATION

August PCE lands with a full annual revision. The BEA will restate data back to 2021, and it releases its third estimate of second-quarter GDP at the same time.

The fix was flagged in July. It matters more now. Last week the Fed's own voices argued that demand, not just oil, drives inflation. A lower number could look like relief even if nothing changed underneath.

The 2-year and homebuilders are most exposed. Both repriced on the demand story last week.

If core drops by about the size of the method change, the economy did not cool. The measurement did. If it drops by more, that is the first real sign of easing. If it holds near the old pace under the new method, the hike case gets stronger.

Watch the income revisions too. New wage data enter the accounts, so the saving rate, 3.0% in July, could move.

The Line Compare core PCE with the revised July figure, not the old 3.3%.

MICRON TESTS THE TIMING

Micron (MU) reports, with its call at 4:30 p.m. Eastern. It guided to $50 billion in revenue, plus or minus $1 billion, and a gross margin near 86%. Analyst estimates sit near $51 billion. The quarter has 14 weeks, not 13.

Last week, credit charged more to fund AI. Chipmakers' default-swap prices rose with their stocks. At Oracle (ORCL), the trouble was delay, not weak demand.

Memory also sits inside Wednesday's first story. RBC links the jump in the old software price gauge to demand for memory and computing gear. That is part of what the BEA is fixing.

A strong guide keeps the AI demand leg standing, and that leg is part of the Fed's case for more hikes. A soft guide, or talk of customers pushing out orders, would carry last week's credit worry into stocks.

The Line Next-quarter revenue guidance, and any word on customers delaying projects.

THE LABOR LEG

Job openings for August arrive Tuesday at 10:00 a.m., after 7.3 million in July. Jobless claims print Thursday at 8:30 a.m., after 197,000 last week. September payrolls land Friday at 8:30 a.m.

August added 162,000 jobs, and unemployment held at 4.1%. June and July were revised up a combined 55,000.

Fed Governor Michael Barr speaks on the outlook Tuesday at 12:40 p.m. He said last week that more increases are likely needed.

A firm report keeps both legs of the hike case in place: sticky inflation and a tight job market. A jump in unemployment would be the first crack, and it would matter most for the 2-year. Four hikes need both legs to hold.

The Line The unemployment rate against 4.1%.

THE HOUSEHOLD CHECK

Last week split the economy. Businesses reported the fastest growth in five years. Consumer sentiment fell to 48.1, and year-ahead inflation expectations rose to 4.6%.

Two companies test the household side. Carnival (CCL) holds its third-quarter call Tuesday at 10:00 a.m. Eastern. Cruise lines burn fuel and sell trips people can skip. Nike (NKE) reports Thursday at about 4:15 p.m. Eastern. It sells discretionary goods under tariffs.

Costco (COST) finance chief Gary Millerchip said members still spend when the item and price are right. That is the bar.

If both hold their outlooks, the household split looks like a mood, not a spending cut. If either cuts, and blames fuel or tariffs, the consumer is starting to pay the bill the bond market set.

The Line Whether either company cuts guidance, and what it blames.

THE ROUTE, NOT THE PRICE

Oil and the 10-year have moved in closer step than at any point in 35 years, by the measure of Cboe Global Markets (CBOE). So every Gulf headline is also a rates headline.

Saudi Arabia's East-West pipeline restarted in phases, with full capacity about six weeks out. A phased U.S.-Iran plan for Hormuz is under discussion. No deal exists. Preliminary tracking showed nine commodity-vessel transits Thursday.

Diesel adds a policy risk. White House advisers Kevin Hassett, Scott Bessent and Jamieson Greer are studying a short-term export ban. Refiners carry the most exposure.

A signed Hormuz sequence would be the fastest route to lower yields. New strikes on the detour would push the other way.

The Line Daily Hormuz transits, and Brent's gap over WTI, near $12 at Friday midday.

ISM manufacturing lands Thursday at 10:00 a.m. Its prices index checks the cost surge the flash PMI flagged.

Accenture (ACN) reports before its 8:00 a.m. call Thursday. It is a read on whether companies keep paying for AI projects.

The quarter ends Wednesday. That closes the books on bank deposit costs, which the Muse selloff put in focus. Those numbers arrive when banks report third-quarter results.

Sector Read Rate-sensitive stocks face two tests this week. The PCE revision could lower the number. Payrolls decide whether that matters.

Last week the bond market moved first. This week the inputs it priced arrive. Inflation comes Wednesday, under new rules. AI demand reports that night. Jobs come Friday.

The trap is Wednesday morning. A lower core number could read as relief when it is only a revision. The better read is the gap between the new number and the revised history.

Then Friday. If unemployment holds near 4.1%, the case for 5% as a floor survives the week. If it jumps, the bond market has to rethink four hikes.

The Fed meets October 27 and 28. Monday's send picks it up from there.