CPI Data and Bank Earnings: What Traders Need to Know

This week may be pivotal for the economy as key data is set to be released. U.S.  December CPI and  JPMorgan's Q4 earnings are scheduled for Tuesday, 13 January. Furthermore, five additional US banks report throughout the week, while a Supreme Court ruling on IEEPA (International Emergency Economic Powers Act) tariffs may arrive on Wednesday.

Here’s what traders and investors need to know:

TL;DR

• December CPI releases Tuesday; consensus forecasts 2.7% YoY

• JPMorgan reports Tuesday; Goldman Sachs and Morgan Stanley report on Thursday

• Supreme Court may rule on IEEPA tariffs

• Markets price in an 84% chance of a pause, with only a 16% probability of a rate cut 

December CPI Expectations

November CPI showed headline inflation at 2.7% YoY, core at 2.6%. FactSet consensus projects December at 2.7% YoY and 0.3% MoM.

Gregory Daco, EY-Parthenon chief economist, told Morningstar inflation will "move slightly higher in early 2026" but not surge. Note: Daco refers to the broader 2026 inflation trend as tariff costs filter through, rather than this specific December print. Fixed income futures markets indicate 16% odds of a cut in January, according to data from the CME FedWatch Tool. (Source: Morningstar)

Bank Earnings: Investment Banking vs NII

• Tuesday 13 Jan 2026: JPMorgan Chase 

• Wednesday 14 Jan 2026: Bank of America, Citigroup, Wells Fargo

• Thursday15 Jan 2026: Goldman Sachs, Morgan Stanley

LSEG estimates compiled in early January project the following consensus EPS figures:

• JPMorgan: $4.96 (vs $4.81 Q4 2024)

• Bank of America: $0.96 (vs $0.82 Q4 2024)

• Citigroup: $1.77 (vs $1.34 Q4 2024)

• Wells Fargo: $1.68 (vs $1.43 Q4 2024)

• Goldman Sachs: $11.37 (vs $11.95 Q4 2024)

• Morgan Stanley: $2.40 (vs $2.22 Q4 2024)

Note: Following JPMorgan's 7 Jan announcement of the Apple Card portfolio acquisition, EPS estimates have been revised to account for the confirmed $2.2B provision.

For commercial banks, Net Interest Income - the spread between what banks earn on loans versus pay on deposits - is the primary profit driver. With the Fed cutting 75 basis points in late 2025, that spread is narrowing. JPMorgan guided 2026 NII at $95 billion, down from $95.8 billion. Wells Fargo expects flat NII. Bank of America, however, guided 5-7% NII growth. Traders may want to keep tabs on divergence: investment banking strength versus NII pressure.

Supreme Court Tariff Ruling

The Supreme Court currently examines whether President Trump overstepped his executive powers through his application of IEEPA to establish wide-ranging trade restrictions. The administration declared trade deficits as a national emergency through IEEPA in early 2025 to begin its implementation without needing congressional approval. The lower courts declared the tariffs illegal, but they continue to operate while the case proceeds to appeal. The court will issue its decision on Wednesday.

The decision may create new market entry requirements that all domestic businesses and importers must follow.

If struck down: Retail, electronics, automotive, industrials, and chemicals may benefit most per PwC. Importers could claim a share of $150-200 billion in refunds since they are the most exposed. However, domestic manufacturers lose tariff protection against foreign competition.

If upheld: The decision would result in import-dependent sectors having to pay higher prices for their necessary goods.

Conclusion

Taken together, the week ahead concentrates several high-impact catalysts into a narrow window, making it a true “must-watch” period for markets. December CPI may help clarify whether inflation is stabilising near current levels or re-accelerating, shaping expectations for a Fed pause versus an early 2026 cut. Bank earnings could reveal whether investment-banking momentum can offset mounting Net Interest Income pressure, offering a read-through on financial sector leadership. Layered on top, a potential Supreme Court ruling on IEEPA tariffs introduces significant policy risk, with clear sector winners and losers. 

With macro data, earnings, and legal developments all converging, traders may want to be prepared for potential shifts should any arise.  

*Past performance does not reflect future results. The above is for marketing and general informational purposes only, and are only projections and should not be taken as investment research, investment advice or a personal recommendation.