Core Insights - The recent market turmoil has led to a significant number of liquidations, with 197,244 individuals liquidated and a total liquidation amount of $753 million [1][2] - The decline in the stock market and Bitcoin's new lows indicate a challenging environment, with further analysis needed to determine potential support levels and rebound opportunities [1][6] Market Conditions - The recent drop in the market is attributed to a $125 billion U.S. Treasury auction absorbing liquidity and the Federal Reserve's lack of concrete actions regarding balance sheet reduction [3][11] - The stock market's correction, influenced by previous overextensions, has had a negative impact on the cryptocurrency market, which has been following the stock market's downward trend [4][5] Bitcoin Analysis - Bitcoin is currently in a consolidation phase, with a potential support range identified between $93,300 and $98,115, where a rebound is expected [6] - A short-term trading strategy suggests entering positions around $99,600, with a stop-loss below recent lows, while monitoring for potential rebounds above $101,600 [7][10] Ethereum Analysis - Ethereum has not reached new lows, with a recent minimum of approximately $3,154, indicating some support at previous low levels [10] - A trading strategy for Ethereum suggests entering positions in the $3,234 to $3,200 range, with a clear exit strategy if recent lows are breached [10] Market Sentiment - The current market sentiment is characterized by a self-fulfilling pessimism, where declining prices lead to increased fear, uncertainty, and doubt (FUD), making it difficult for the market to recover without significant capital inflows [5][14] - The market is showing signs of reluctance from investors to engage in secondary market activities, indicating a challenging environment for new investments [14]

Core Insights - The cryptocurrency market experienced a 6.1% decline in October, marking the first "red October" since 2018, following a deleveraging shock [1] - Despite the overall market pressure, BNB rose by 6.2% due to the launch of popular projects and the tokenization of a money market fund by China Merchants Bank [1] - Major tokens such as SOL, ADA, and DOGE saw declines exceeding 10% [1] Market Performance - The total value locked (TVL) in DeFi decreased by 4.85% [1] - The market capitalization of stablecoins increased by 3.54% [1] - Institutional demand for ETH remains strong, with treasury holdings reaching 5% of total supply [1] Future Outlook - The report suggests that November may see a recovery in market sentiment, with attention on the potential benefits from the end of the Federal Reserve's balance sheet reduction and improvements in US-China relations [1]

Summary of Key Points from the Conference Call Industry Overview - The discussion revolves around the **U.S. repurchase (repo) market** and its liquidity conditions, particularly in the context of recent fluctuations in repo rates and the Federal Reserve's monetary policy actions. Core Insights and Arguments 1. **Repo Rate Surge**: At the end of October, the U.S. repo rate surged to **47 basis points**, the highest since the pandemic, indicating significant liquidity pressure in the market [1][2][11]. 2. **Use of Fed's Standing Repo Facility**: The usage of the Federal Reserve's standing repo facility peaked at **$50 billion**, marking the highest level since its establishment in 2021, before declining significantly in the following days [2][21]. 3. **Market Composition**: The U.S. repo market consists of **money market funds, dealer banks, and hedge funds**, with funds flowing primarily through tri-party repos and bilateral delivery versus payment agreements [1][4]. 4. **Liquidity Distribution**: The repo market experienced two distinct phases during the Fed's balance sheet reduction, affecting liquidity distribution and borrowing costs among market participants [7][8]. 5. **Impact of Government Actions**: The recent U.S. government shutdown and Treasury bond issuance led to an increase in the Treasury General Account (TGA) balance, which in turn reduced bank reserves and affected the repo market dynamics [9][21]. 6. **End-of-Month Effects**: At month-end and quarter-end, dealer banks reduce their balance sheets to meet regulatory requirements, leading to increased borrowing costs for hedge funds and spikes in repo rates [10][11]. 7. **Misinterpretation of Liquidity Crisis**: Claims of a liquidity crisis among foreign banks' U.S. branches were deemed incorrect, as the observed decrease in their reserves was a natural outcome of reduced arbitrage activities rather than a liquidity shock [12]. 8. **Liquidity Definition**: Liquidity refers to the ease with which economic entities can obtain cash, and a liquidity crisis occurs when institutions struggle to access necessary cash [13][14]. 9. **Comparison of Liquidity Events**: The liquidity crisis in March 2020, triggered by the pandemic, was characterized by widespread asset sell-offs and a significant rise in the dollar's value, contrasting with the more contained liquidity pressures observed in recent months [17][18]. 10. **Future Repo Market Outlook**: The repo market's liquidity pressure is expected to ease, contingent on the reopening of the government and potential court rulings affecting TGA balances. The Fed may also consider resuming asset purchases if repo rates continue to rise significantly [21][22]. Other Important but Overlooked Content - **Arbitrage Mechanisms**: In normal conditions, the tri-party repo rate should lie between the Fed's overnight reverse repo rate (3.75%) and the standing repo facility rate (4%), ensuring that money market funds earn more than depositing with the Fed [5][6]. - **Market Resilience**: Recent fluctuations in the repo market have not significantly impacted broader asset classes, indicating a degree of resilience in the financial system [19]. - **Dollar Strength**: The recent strength of the dollar is attributed to various factors, including the Fed's stance on interest rates and positive economic data, rather than a direct liquidity crisis [24].

中国工商银行（亚洲）发布的报告构建了"3×3美元流动性分析矩阵"，通过联邦基金市场、回购市场、离岸美元市场三大核心市场，结合规模、价格、政策 三类指标，系统监测美元流动性变化，为市场分析提供全面框架。 联邦基金市场作为美元流动性基石，在充裕准备金框架下以规模指标为核心观测点。准备金总量直接反映银行体系基础流动性，其变动受美联储公开市场操 作（QE/QT）和负债结构（TGA账户收支、RRP工具使用）影响。当前美联储缩表持续推进，但RRP工具发挥"缓冲垫"作用，截至2025年9月，准备金总量 3.2万亿美元，占银行总资产12.9%，仍处于充裕区间，联邦基金利率稳定在政策区间内。贴现窗口作为辅助指标，因"污名化效应"日常使用克制，仅在危机 时大规模动用。 回购市场是流动性重要枢纽，重点关注SOFR价格变动、一级交易商做市能力及政策工具使用。价格维度，SOFR作为定价基准，其与ON RRP的利差扩大预 示流动性收紧，2025年9月利差中枢升至16BP，显示市场边际收紧。规模维度，一级交易商国债逆回购规模与准备金比值升至0.88，虽未达危机水平，但反 映压力积聚。政策层面，常备回购便利（SRF）作为"利率天花板"，20 ...

Core Viewpoint - The article discusses the tightening liquidity in the US repurchase market, highlighting the significant widening of the spread between the Secured Overnight Financing Rate (SOFR) and the Overnight Reverse Repurchase Rate (ONRRP) to 47 basis points, the highest since the pandemic began in 2020, and the surge in the usage of the Standing Repo Facility (SRF) to $50 billion, marking a new high since its establishment in 2021 [2][3]. Group 1: Causes of Liquidity Tightening - The liquidity tightening is attributed to a combination of the US government shutdown and month-end factors, with the usage of overnight reverse repos declining sharply after the Federal Reserve halted interest rate hikes and accelerated balance sheet reduction [3]. - The Treasury General Account (TGA) balance has risen to $1 trillion, significantly above the acceptable level of $850 billion, further draining liquidity from the repo market [3]. - The combination of reduced liquidity in the repo market and banks being more cautious in external financing due to regulatory requirements at month-end has led to the rapid widening of the SOFR and ONRRP spread [3]. Group 2: Current Market Impact - Despite the tightening liquidity in the repo market, there has not been a substantial impact on other financial markets, as the daily limit for the SRF is $500 billion, and the Federal Reserve can quickly respond to liquidity needs [4]. - Recent data shows that the SOFR and ONRRP spread has narrowed to 25 basis points, indicating a decrease in the usage of the SRF [4]. - The performance of risk assets has been more reflective of their inherent vulnerabilities, with notable declines in global risk asset prices, but short-term fluctuations in the money market are not expected to have a direct and lasting impact on stock prices [4].

Group 1 - Wall Street analysts indicate that the tightness in the money market may persist until November due to high financing costs, pressuring the Federal Reserve to act before halting balance sheet reduction next month [2] - The overnight secured financing rate surged by 18 basis points last Friday, marking the largest single-day fluctuation since the Fed's rate hike cycle began in March 2020 [2] - Despite a decrease in SOFR on Monday after month-end pressures eased, it remains above the Fed's key policy benchmark rates, including the federal funds rate [2] Group 2 - Bank of America previously anticipated that the Fed would end quantitative tightening (QT) at the end of October and immediately begin asset purchases to expand its balance sheet [2] - Fed Chair Jerome Powell stated that the Fed would eventually start to gradually increase reserve levels to keep pace with the banking system and economic developments, but did not specify a timeline [2] - Other Fed officials, including Vice Chair for Supervision Michael Barr, believe the central bank should maintain the smallest possible balance sheet [2] Group 3 - The Chinese Ministry of Finance plans to issue up to $4 billion in senior bonds, with three companies participating in the issuance [4] - The current yield for China's two-year government bonds is 1.42%, while the ten-year yield is 1.80% [8] - The U.S. two-year government bond yield has decreased by 2 basis points to 3.58%, and the ten-year yield has decreased by 3 basis points to 4.10% [8]

Market Overview - US stock index futures showed mixed movements with Dow futures up by 0.04%, S&P 500 futures down by 0.14%, and Nasdaq futures down by 0.24% [1] - European indices also displayed varied performance, with Germany's DAX down by 0.37%, UK's FTSE 100 up by 0.04%, and France's CAC 40 down by 0.05% [2][3] - WTI crude oil prices fell by 0.31% to $60.37 per barrel, while Brent crude oil decreased by 0.20% to $64.31 per barrel [3][4] Economic Data and Events - The upcoming ADP employment data is expected to show an increase of 28,000 jobs in October, a significant reversal from the previous month's loss of 32,000 jobs [5] - The US government shutdown is set to break the record for the longest duration, impacting economic data releases and potentially leading to increased pressure on lawmakers to reach a compromise [5] Company Earnings and Forecasts - AMD reported a 36% year-over-year revenue increase to $9.25 billion, exceeding market expectations, but the outlook for Q4 revenue of $9.3 to $9.9 billion was met with some disappointment [8][9] - Super Micro Computer's Q1 revenue fell to $5.02 billion, below analyst expectations, marking the sixth consecutive quarter of underperformance [9] - Pinterest's Q3 revenue was $1.05 billion, meeting expectations, but the Q4 guidance fell short of analyst predictions, leading to a pre-market drop of over 18% [10] - Toyota's Q2 operating profit declined by 27% year-over-year, but the company raised its full-year profit and sales guidance despite the drop [11] - Novo Nordisk's Q3 sales increased by 11% year-over-year, with a strong performance in diabetes and weight loss medications, and the company updated its sales growth forecast for 2025 [12] - Rivian's Q3 revenue reached $1.56 billion, a 78% increase year-over-year, with a positive gross margin reported for the second consecutive quarter [13] - Arista Networks achieved Q3 revenue of $2.31 billion, a 27% increase, and provided a positive outlook for Q4 revenue [14] - Astera Labs reported a 104% year-over-year revenue increase in Q3, but the Q4 earnings guidance was below market expectations [15] - Tempus AI's Q3 revenue grew by 84.7% year-over-year, but net losses widened, leading to a pre-market decline [16] - McDonald's Q3 same-store sales grew by 3.6%, exceeding expectations, although adjusted EPS fell short of forecasts [17] Upcoming Earnings Announcements - Notable earnings announcements expected include Qualcomm, Arm, Robinhood, and DoorDash [17][18]

Core Viewpoint - The liquidity in the US money market is expected to remain tight in November, prompting the Federal Reserve to potentially increase liquidity injections before officially halting balance sheet reduction in December [1] Group 1: Market Conditions - High financing costs are contributing to the ongoing liquidity strain in the US money market [1] - Analysts suggest that the Federal Reserve may be compelled to act sooner than planned due to market pressures [1] Group 2: Federal Reserve Actions - The head of interest rate strategy at Bank of America indicates that the Federal Reserve is under time pressure and may need to respond quickly [1] - A macro strategist from BNY Mellon mentions that if market pressures and related rates remain above the policy rate, temporary open market operations could be a possibility [1]

Group 1: Report Industry Investment Rating - No relevant content provided Group 2: Core Viewpoints of the Report - Alumina is expected to fluctuate mainly in November. The supply surplus pattern will continue, with cost support potentially weakening, but there are expectations of production cuts later [7]. - Electrolytic aluminum is expected to oscillate strongly in November and still has room for an upward trend. Although downstream demand growth is limited and consumption overdraft is obvious, the macro - positive factors will continue [7]. Group 3: Summary by Directory 01 Viewpoints and Strategies - **Alumina**: The supply of bauxite in China is sufficient, and the alumina supply surplus pattern will continue. The demand is at a high level, but the inventory is at a four - year high, which will continuously pressure prices. The cost support may weaken marginally, and it may oscillate in November [7]. - **Electrolytic aluminum**: The supply is strong, with the main production areas' operating rates remaining high and limited subsequent increments. The downstream demand is weak overall, but the macro - positive factors from the approaching end of the Fed's balance - sheet reduction will continue, and it may oscillate strongly in November [7]. 02 Bauxite Supply Situation Review and Outlook - **Domestic production**: In September, China's bauxite production was 551900 tons, a year - on - year increase of 1.3%, at a medium - low level in the past four years. Output in Guangxi and Guizhou decreased month - on - month, while that in Henan increased [10]. - **Imports**: From January to September, the cumulative import volume was 158 million tons, a year - on - year increase of 32.27%. The impact of the rainy season has weakened, and subsequent imports may rebound [14]. - **Shipments by country**: In September, shipments from Australia to China decreased month - on - month, while those from Guinea increased, reaching 6 million tons but a year - on - year decrease of 29.22%. As of October 24, port inventory was 27.7177 million tons, at a medium - high level in the past six years [19]. 03 Alumina Fundamental Situation Review and Outlook - **Cost and profit**: In September, the production cost decreased to 2808.8 yuan/ton, and the production profit fell to about 289.8 yuan/ton. The capacity utilization rates in Guangxi, Henan, Shandong, Shanxi, and Guizhou increased overall [23][24]. - **Production volume**: In September, global metallurgical alumina production was 12.88 million tons, a year - on - year increase of 3.95%, and China's was 7.746 million tons, a year - on - year increase of 12.69%, both at the highest levels in the past six years [29]. - **Net exports**: From January to September, China maintained a net export status. In September, the net import volume was - 186400 tons, a year - on - year decrease of 90%, reaching the lowest level in the past six years [34]. - **Inventory**: As of October 31, China's alumina inventory was 4.732 million tons, a year - on - year increase of 22.5%, and the inventory continued to accumulate [39]. 04 Electrolytic Aluminum Supply - Side Situation Review and Outlook - **Cost and profit**: In September, the electrolytic aluminum production cost decreased to 15918 yuan/ton, and the production profit rose to 4849 yuan/ton [44]. - **Production volume**: In September, global electrolytic aluminum production was 6.08 million tons, a year - on - year increase of 1.22%, and China's was 3.6796 million tons, a year - on - year increase of 2.73%, at a high and the highest level in the past six years respectively [49]. - **Imports**: In October, the Shanghai - London ratio of electrolytic aluminum decreased. In September, the import volume was 517400 tons, at the highest level in the past six years [54]. - **Inventory**: In September, the molten aluminum ratio rose to 73.71%. As of October 31, the electrolytic aluminum social inventory was 605000 tons, at a relatively low level in the past six years. LME aluminum ingot inventory continued to decline and was at the lowest level in the past six years [59][63]. 05 Electrolytic Aluminum Downstream and Terminal Consumption Review and Outlook - **Downstream sectors' operating rates**: In September, the aluminum profile operating rate dropped to 41.9% and will remain weak; the aluminum plate and strip operating rate rose to 73.99% [68][69]. - **Exports**: From January to September, the cumulative export volume of aluminum profiles was 652200 tons, a year - on - year decrease of 18.82%; that of aluminum plates and strips was 2.2913 million tons, a year - on - year decrease of 9.67%; that of aluminum foils was 1.0141 million tons, a year - on - year decrease of 11.57%; and that of aluminum cables was 198200 tons, a year - on - year increase of 44.28% [73][78]. - **Real estate**: From January to September, the new construction area was 45400 hectares, a year - on - year decrease of 18.9%; the construction area was 648600 hectares, a year - on - year decrease of 9.4%; and the completion area was 31100 hectares, a year - on - year decrease of 15.3%, with the decline rates of new construction and completion narrowing [83][88]. - **Automobiles**: From January to September, China's cumulative automobile production was 24.3022 million vehicles, a year - on - year increase of 13.23%. In September, the production was 3.2758 million vehicles, the sales were 3.2264 million vehicles, and the production - sales ratio dropped to 0.9849 [91]. - **New energy vehicles**: From January to September, the cumulative production was 11.2201 million vehicles, a year - on - year increase of 34.71%. In September, the production was 1.617 million vehicles, the sales were 1.604 million vehicles, and the production - sales ratio dropped to 0.992 [96]. - **Household appliances**: From January to September, the cumulative year - on - year growth rates of the production and sales of three major white - goods all narrowed slightly. The cumulative production of refrigerators increased by 3.05%, air conditioners by 4.74%, and washing machines by 9.61%. The cumulative sales of refrigerators increased by 3.19%, air conditioners by 5.56%, and washing machines by 8.87% [101]. - **Photovoltaic**: In September, China's cumulative photovoltaic installed capacity was 1126.51GW, a year - on - year increase of 45.7%, and the cumulative newly - added installed capacity was 240.27GW, a year - on - year increase of 49.35%, with the year - on - year growth rate narrowing significantly [106].

Core Insights - The report constructs a "3×3" matrix for analyzing USD liquidity, focusing on the federal funds market, repo market, and offshore USD market, while monitoring liquidity changes across scale, price, and policy dimensions [1][6][8] - Current structural pressures on USD liquidity are attributed to the Federal Reserve's balance sheet reduction and large-scale debt issuance, but the likelihood of a comprehensive liquidity crisis remains low under non-extreme conditions due to robust policy tools [1][3][6] Federal Funds Market - The federal funds market is the cornerstone of USD liquidity, with a focus on scale indicators. The Fed's balance sheet reduction since June 2022 has decreased total assets to 74.1% of the June 2022 level, but reverse repo tools (RRP) have provided a buffer, maintaining reserves at $3.2 trillion as of September 2025, which is 12.9% of total bank assets [1][13] - The effective federal funds rate (EFFR) remains stable within the interest on reserves balance (IORB) of 4.15% and ON RRP of 4.0%, with discount window usage being restrained due to stigma effects [1][17] Repo Market - The repo market is a critical liquidity hub, with the secured overnight financing rate (SOFR) and primary dealer market-making capabilities as core observation points. Since September 2025, SOFR has fluctuated around the upper limit of the rate corridor, with a spread to ON RRP increasing to 16 basis points, indicating marginal tightening [2][20] - The ratio of primary dealer reverse repos to reserves has risen to 0.88, reflecting ongoing pressure, although it remains below crisis levels [2][20] Offshore USD Market - The offshore USD market has shown characteristics of "bondification" and "derivatization," with currency swap basis as a key observation indicator. Since 2025, the cross-currency basis for euro/USD and yen/USD has narrowed, indicating maintained offshore liquidity [2][27] - The use of central bank currency swaps and FIMA repo facilities during crises serves as significant signals of systemic liquidity pressure, with both tools available to address liquidity needs across various market levels [2][35][38] Future Outlook - Future USD liquidity faces multiple contraction pressures, including ongoing balance sheet reduction by the Fed and increased Treasury issuance, which may lead reserves to drop below $3 trillion by September 2025, approaching a critical threshold of $2.7 trillion [3][6] - The Fed has established a multi-layered liquidity management toolset, which includes the discount window, SRF, FIMA repo, and central bank currency swaps, to mitigate systemic risks under non-extreme conditions [3][6]