Forex News

Australia’s 10-year government bond yield slipped to 4.42%, extending its decline from the previous session even after the Reserve Bank signalled a cautious policy outlook. Minutes from the RBA’s latest meeting showed that policymakers would consider cutting interest rates only if the labour market materially weakens. While the board noted that current monetary settings remain “slightly restrictive,” it also acknowledged that it was possible this may no longer be the case, which reduces the scope for additional easing. Data released today showed that annual wage growth held steady at 3.4% in the third quarter, matching expectations and reinforcing the view that the labour market remains tight. Still, markets assign a 50% chance of one final rate cut from the RBA by May next year.

Silver rose toward $51 per ounce on Wednesday, moving away from one-week lows as a selloff in risk assets, including tech stocks and cryptocurrencies, lifted safe-haven demand for precious metals. Signs of a weakening US labor market also supported expectations for further Federal Reserve rate cuts, with Fed Governor Christopher Waller noting increased discussions of layoffs as firms prepare for softer demand and potential productivity gains from artificial intelligence. However, markets are only pricing in roughly a 47% chance of a 25 basis point rate reduction in December, down from over 90% a month ago. Physical factors also continue to offer some support for the white metal, with India’s wedding season is boosting physical demand, while concerns over potential US tariffs on silver have added an additional layer of unease to the outlook.

Japan’s 10-year government bond yield climbed above 1.77% on Wednesday, marking a fresh 17-year high ahead of a crucial debt auction that could indicate investor demand amid rising fiscal concerns. The Ministry of Finance plans to auction around 800 billion yen in 20-year JGBs. On Tuesday, the government proposed a supplementary budget exceeding 25 trillion yen to fund Prime Minister Sanae Takaichi’s stimulus plan, far above last year’s 13.9 trillion yen extra budget, stoking debt worries. Meanwhile, Bank of Japan Governor Kazuo Ueda told the prime minister that the central bank is gradually raising rates to steer inflation toward its 2% target while supporting sustainable growth. Afterward, Ueda told reporters the prime minister made no specific request on monetary policy. On the data front, machinery orders in Japan rose more than expected in September, signaling robust capital spending.

The New Zealand dollar fell to $0.562, hovering near a seven-month low, amid expectations that the Reserve Bank will cut interest rates again next week. Markets have fully priced in a 25bps reduction, following a run of weak economic indicators that reinforced the need for further policy stimulus. Adding to this, data out today showed producer prices rose less than expected in third quarter, signaling that price pressures are easing. However, analysts recently noted that this could be the final cut in the current easing cycle, barring any significant deterioration in global economic conditions. Meanwhile, President Donald Trump last week lifted tariffs on more than 200 food products in response to rising US grocery prices. The affected goods account for about 25% of New Zealand’s exports to the US, a move that is expected to provide support to the Antipodean country’s export sector.

Indonesian stocks rose 41 points, or 0.5%, to 8,402 in early Wednesday trade, rebounding from weakness in the prior session, led by healthcare, communications, and financials. A modest uptick in U.S. futures supported sentiment after the S&P 500 and Dow logged a fourth straight decline overnight amid concerns over stretched AI valuations ahead of Nvidia’s earnings and ongoing uncertainty around the Fed’s rate outlook. Investor confidence also drew support from the International Monetary Fund (IMF), which continues to highlight Indonesia as a global outperformer despite a challenging external backdrop. Gains were capped, however, by caution ahead of Bank Indonesia’s policy decision later today, even as Governor Perry Warjiyo signaled that subdued inflation may open room for future rate cuts following a total 150 bps of easing since September 2024. Among notable movers were Kalbe Farma (4.2%), Jhonlin Agro Raya (2.0%), Energi Mega Persada (1.6%), and Pertamina Geothermal Energy (1.3%).

The Shanghai Composite rose 0.2% to around 3,950, while the Shenzhen Component gained 0.4% to 13,130 on Wednesday, ending a three-day slide as sentiment stabilized and investors looked for fresh market catalysts. Tech and new energy stocks rebounded, with notable gains from Zhongji Innolight (3.6%), Beijing Teamsun (1.5%), Tianqi Lithium (5.2%), Do-Fluoride New Materials (1.4%) and Ganfeng Lithium (4.9%). Meanwhile, China sold €4 billion in euro-denominated bonds, drawing record demand, highlighting growing investor appetite for the country’s debt. In corporate news, PDD Holdings warned of a slowdown amid rising ecommerce competition, while Baidu posted its largest revenue drop on record due to weakening advertising. Xiaomi, meanwhile, reported quarterly profits from its electric vehicle business for the first time.

Hong Kong shares were little changed, hovering around 25,940 in early Wednesday trade, following three straight sessions of losses. Gains in tech and consumer stocks helped offset weakness in financials and property, though markets hovered near a two-week low ahead of October inflation data in the city, which has remained steady since July. Meanwhile, the Hong Kong Monetary Authority is reportedly tightening oversight of banks’ handling of distressed loans amid deepening property concerns. In China, the PBoC is set to announce its monthly loan prime rates on Thursday, with expectations for record-low levels to be maintained. In the U.S., stock futures edged higher after the S&P 500 and Dow posted a fourth consecutive decline overnight, pressured by caution ahead of Nvidia’s earnings and uncertainty over the Fed’s rate trajectory. Notable movers included Chow Tai Fook (2.8%), Trip.com (2.7%), and Laopu Gold (1.5%), while Techtronic Industries (-3.5%) and Xiaomi (-3.4%) led losses.

The Japanese yen held around 155.5 per dollar on Wednesday, pausing a recent decline as investors assessed the Bank of Japan’s policy outlook following a meeting between Governor Kazuo Ueda and Prime Minister Sanae Takaichi. On Tuesday, Ueda told Takaichi that the central bank is gradually raising interest rates to steer inflation toward its 2% target while supporting sustainable economic growth. After the meeting, he told reporters that the prime minister made no specific requests on monetary policy. Market views remain divided on whether the BOJ will raise rates again in December amid mixed economic signals. On the data front, Japan’s machinery orders rose more than expected in September, pointing to robust capital spending. Still, the yen traded close to ten-month lows amid expectations of large-scale fiscal spending under the new administration.

Top currency losers are New Zealand Dollar (-0.38%) and South Korean Won (-0.32%). Meanwhile, Chinese Yuan and Japanese Yen were little changed.

The Australian dollar traded around $0.650, moving sideways near a two-week low, as investors weighed the RBA’s hawkish stance against cautious global risk sentiment and a firmer US dollar. Minutes from the RBA’s November policy meeting showed the central bank could hold rates steady for an extended period if data continues to surprise on the upside. Latest data showing steady Q3 wage growth, alongside last week’s upbeat jobs report and a sticky inflation reading, reinforced expectations that the easing cycle is over. Swaps imply just a 50% probability of a final RBA cut in May next year. Meanwhile, the Aussie, often used as a proxy for risk due to Australia’s reliance on commodity exports linked to global growth, remained under pressure after global stocks fell on concerns about lofty artificial intelligence valuations. A stronger US dollar added to the downside as investors tempered expectations for a near-term Federal Reserve rate cut while awaiting key economic data.

Gold prices fell to around $4,060 per ounce on Wednesday, giving back some gains from the previous session, as investors remained cautious ahead of major economic releases. Key focal points include the FOMC meeting minutes later today, followed by Thursday’s jobs report, both of which could provide more clarity on the interest rate outlook. US agencies have started rolling out data delayed by the government shutdown, with Americans claiming unemployment benefits hitting a two-month high in mid-October and continued claims rising to 1.9 million for the week ending October 18. While the figures slightly lifted hopes for a December rate cut, investors worry that upcoming data could constrain the Fed’s ability to ease further amid policymakers’ skepticism. Meanwhile, concerns over lofty tech valuations have weighed on risk sentiment, potentially increasing gold’s safe-haven appeal amid the ongoing equity market sell-off.

The benchmark KOSPI fell 0.34% to around 3,940 on Wednesday, extending its decline for a second session following overnight losses on Wall Street. The downturn in Korean equities largely mirrored the pullback in US technology shares, with investors growing increasingly cautious ahead of Thursday’s US employment report. Adding to the broader unease, Alphabet CEO Sundar Pichai voiced strong warnings about the fragility of the current AI boom. He stressed that the rapid AI surge shows signs of speculative excess and cautioning that any downturn could reverberate across the sector, with no company fully shielded. Tech heavyweights Samsung Electronics (-1.74%) and SK Hynix (-2.11%) led the decline, while energy firms LG Energy Solution (-2.03%) and Doosan Enerbility (-1.59%) posted significant losses.

The dollar index was little changed around 99.6 on Wednesday, holding gains from earlier in the week amid tempered expectations for a near-term Federal Reserve interest rate cut, as investors awaited key economic data for guidance. Markets now price in roughly a 47% chance of a 25 basis point rate reduction in December, down from over 90% a month ago. Several Fed officials cautioned against further cuts amid inflationary risks, though Governor Christopher Waller reiterated support for easing rates given signs of labor market weakness. The latest Labor Department data showed initial jobless claims at 232K for the week ended October 18, with continuing claims at 1.957 million, the highest since August. The highly-anticipated September jobs report will be released on Thursday. Markets will also watch earnings from major US retailers for clues on consumer spending.

WTI crude oil futures fell toward $60 on Wednesday, trimming the prior session’s gains as another inventory build outweighed concerns over potential fallout from Russia-related sanctions. The API reported that US crude inventories rose by 4.4 million barrels last week, the third consecutive increase, and a level that, if confirmed, would be the highest in more than five months. The data added to concerns that global supply will outpace demand, with the IEA forecasting a record surplus next year. In a sign of swelling supply, crude on tankers climbed to nearly 1.4 billion barrels last week, either en route to buyers or in floating storage, according to Vortexa. Limiting losses, US sanctions on Rosneft and Lukoil are set to take effect within days. In anticipation, major Asian buyers, including China, India, and Turkey, have paused some purchases, while Europe’s diesel market has strengthened.

Qatar’s annual inflation rate eased slightly to 1.11% in October 2025 from 1.15% in the previous month, which was the highest level since August 2024. Upward price pressures were recorded in miscellaneous goods and services (15.80% vs 12.75% in September), education (2.07% vs 2.47%), clothing and footwear (1.65% vs 2.93%), furniture and household equipment (1.39% vs -0.35%), housing and utilities (0.66% vs -0.23%), recreation and culture (0.38% vs 1.53%), and communication (0.05% vs 0.56%). Downward price pressures came from restaurants and hotels (-2.34% vs -1.48%), health (-0.75% vs -0.07%), food and beverages (-0.70% vs 1.42%), and transport (-0.46% vs -1.12%), while tobacco prices remained unchanged. On a monthly basis, consumer prices increased by 0.90%, matching the previous month and remaining the highest monthly inflation rate in eleven months.

The Nikkei 225 Index rose 0.2% toward 48,800 while the broader Topix Index gained 0.1% to 3,254 on Wednesday, halting a sharp three day decline and defying another selloff on Wall Street overnight as market sentiment stabilized. Global stocks have come under pressure recently amid concerns about lofty artificial intelligence valuations and uncertainty over the Federal Reserve’s rate cutting path. Meanwhile, investors prepared for the highly anticipated earnings report from AI chipmaker Nvidia, given the exposure of Japanese technology firms in the global AI supply chain. Notable gains were seen from SoftBank Group (1%), Fast Retailing (1.4%), Furukawa Electric (2%), Toyota Motor (0.3%) and Recruit Holdings (0.9%). On the economic front, data showed that machinery orders in Japan rose more than expected in September, pointing to robust capital spending.

Australia’s seasonally adjusted Wage Price Index rose by 3.4% year-on-year in Q3 2025, unchanged from the previous quarter and in line with market expectations. Public sector wages increased by 3.8%, slightly above the 3.7% rise in Q2, while private sector wages grew by 3.2%, easing from 3.4% previously. In original terms, the electricity, gas, water & waste services industry and public administration recorded the strongest annual wage gains at 4.3% each. They were followed by healthcare and social assistance (3.8%), mining (3.6%), education and training (3.6%), construction (3.4%), rental, hiring, and real estate services (3.3%), and professional, scientific & technical services (3.3%). Healthcare and social assistance roles were the main contributors to quarterly wage growth. On a quarterly basis, overall wage prices rose by 0.8%, matching the previous quarter and aligning with market forecasts.

JP225 decreased to 48300.00 Index Points, the lowest since October 2025. Over the past 4 weeks, Japan Stock Market Index (JP225) lost 1.62%, and in the last 12 months, it increased 26.17%.

Japan’s core machinery orders, which exclude volatile sectors such as ships and electric power, jumped 4.2% month-over-month to ¥927.8 billion in September 2025, reversing from a 0.9% fall in August and exceeding market expectations for a 2.5% gain. The increase was led by the manufacturing sector, which jumped 23.3% to ¥515.2 billion, while non-manufacturing orders fell 8.7% to ¥428.3 billion. By industry, the largest advances came from chemical and chemical products (388.9%), pulp, paper and paper products (84.5%), other transport equipment (40.7%), mining and quarrying of stone and gravel (40.4%), and general-purpose and production machinery (29.7%). On an annual basis, private-sector orders grew 11.6% in September, accelerating from a 1.6% gain in August and beating forecasts of 5.4%. Core machinery orders are seen as a key yet volatile leading indicator of capital expenditure over the coming six to nine months.

The Westpac–Melbourne Institute Leading Economic Index for Australia edged up 0.1% month-over-month in October 2025 after a flat reading in the previous month. The six-month annualized growth rate also improved, rising to 0.35% from 0.1%. After hovering around zero for much of the past six months, the index has begun to show modest momentum heading into year-end, with the October update indicating slightly above-trend growth in early 2026. Although the signal is mild, it aligns with expectations that activity will continue to strengthen through the rest of 2025 and into next year. Westpac economist Ryan Wells forecasts GDP growth to pick up from 1.8% currently to 2.4% in 2026. On interest rates, Westpac expects the RBA to keep the cash rate on hold until mid-2026, by which time easing inflation should be more evident. This would allow for potential rate cuts in May and August, returning policy to broadly neutral settings.