Market reaction to U.S. President Donald Trump's tariffs U-turn on more than 200 food products was muted, with some analysts saying the move was not a surprise due to cost-of- living issues. Elsewhere, sterling remained under pressure following a whirlwind Friday session as speculation swirled around the UK government's highly anticipated November 26 budget. The safe-haven Swiss franc hovered around a one-month high and last stood at 0.7941 per dollar, finding support from jitters over an ugly selloff in s ...

Group 1 - Market sentiment is dominated by concerns over the economic impact of the US government shutdown, leading to a lack of rebound momentum for the dollar and strong fluctuations in gold prices within the $4150-$4200 range [1][3] - The absence of key economic data, particularly the October non-farm payroll and inflation figures, complicates the assessment of the economic situation, with economists estimating that the shutdown could reduce quarterly GDP growth by approximately 1.5%-2% [1][2] - The euro is experiencing mild fluctuations around 1.1650 as the market awaits revisions to the Eurozone's Q3 GDP and employment figures, while the British pound remains under pressure due to the upcoming budget announcement [1][2] Group 2 - Gold prices have recently broken through $4200, reaching a three-week high, but have slightly adjusted while remaining above $4150, supported by increased safe-haven demand and a weaker dollar [2][3] - The probability of a rate cut by the Federal Reserve in December has decreased from 62% to about 50%, although the necessity for policy easing remains due to weakening economic momentum [2][3] - China's retail and industrial production growth rates for October were 2.9% and 4.9%, respectively, aligning with a steady recovery trend [2] Group 3 - The market is still processing the economic aftermath of the shutdown, with the lack of key data making growth prospects and policy direction harder to assess, resulting in continued weakness for the dollar [3][4] - Gold has established structural support in the $4150-$4200 range, maintaining bullish momentum as long as it does not fall below $4145, with further attention on potential resistance levels at $4245 and $4300 [4] - The dollar's trajectory will depend on whether the missing data can be clarified this week, which would directly influence market expectations regarding the December policy path [4]

The dollar index (DXY00) fell to a 2-week low today and is down by -0.29%.  The dollar is falling today on speculation that the reopening of the US government will allow the release of delayed economic reports that may show a weakening US economy, prompting the Fed to keep cutting interest rates. Losses in the dollar are limited after hawkish comments from the Fed, following Boston Fed President Susan Collins and Cleveland Fed President Beth Hammack, who said they favor keeping interest rates steady.   Al ...

By Kevin Buckland and Amanda Cooper TOKYO/LONDON (Reuters) -The dollar eased on Thursday after U.S. President Donald Trump signed a deal to end the government shutdown, while the yen hit a record low against the euro after Japan's new prime ​minister said she wanted the central bank to go slow on rate hikes. The pound briefly touched a session low, before recovering, after a report ‌showed the UK economy barely grew in the third quarter of the year. The Australian dollar, meanwhile, hit a two-week high ...

Jane Foley of Rabobank writing The dollar will be more sensitive to poor data releases in the coming weeks than to good. Either way, it's time to reassess the outlook for the greenback. Jane joins us now for more.And welcome to the program. What data are you focused on. You know what.Any data, I think at this point, but particularly, of course, the labor data and the CPI data, if and when we get it. But, you know, we all know that that's going to be pretty confusing. Perhaps in October it will be affected b ...

Core Viewpoint - The Japanese yen has rebounded after seven consecutive days of losses against the U.S. dollar, influenced by comments from Japanese and U.S. officials regarding fiscal and monetary policy [1][2]. Group 1: Economic Policy Insights - Japan's new economic revitalization minister, Minoru Kiuchi, emphasized the importance of stimulating demand and maintaining a tight labor market while ensuring fiscal discipline [2]. - Kiuchi's remarks indicate that the government is closely monitoring the effects of currency fluctuations on the economy [2]. - Comments from U.S. Treasury Secretary Scott Bessent suggest a preference for conventional monetary policy tools, such as interest rate hikes, rather than foreign exchange intervention [4]. Group 2: Market Reactions - The sentiment around the Japanese government bond (JGB) market and the yen has improved following the recent comments from officials [3]. - Foreign investors are reassessing their views on the Takaichi administration's fiscal policy, with indications that there may be less fiscal stimulus than previously expected [4]. - The yen was reported to be up 0.44% against the U.S. dollar, trading at 152.18 per dollar [6]. Group 3: Central Bank Expectations - The Bank of Japan (BOJ) is anticipated to maintain its current interest rates during its upcoming meeting, but market focus will be on potential signals regarding future rate hikes [5]. - The European Central Bank is also expected to keep rates unchanged, while the U.S. Federal Reserve is likely to cut rates [6].

Currency Market Overview - The dollar index rose by +0.34% to a four-session high, supported by weakness in the yen and easing US-China trade tensions [1] - The yen fell to a one-week low against the dollar due to expectations of expansionary fiscal policy under new Japanese Prime Minister Takaichi [1][5] - The euro declined by -0.31% as a result of dollar strength and negative sentiment from a credit rating downgrade of France [3] Economic Indicators - The October Philadelphia Fed non-manufacturing business activity survey dropped -9.9 to a four-month low of -22.2, indicating a slowdown in business activity [2] - Markets are anticipating a 97% chance of a -25 basis point rate cut at the upcoming FOMC meeting on October 28-29 [2] Central Bank Policies - The Federal Reserve is expected to continue cutting interest rates, while the European Central Bank (ECB) is nearing the end of its rate-cutting cycle, leading to central bank divergence [3][4] - Swaps indicate a 2% chance of a -25 basis point rate cut by the ECB at the October 30 policy meeting [4] Japan's Economic Data - Japan's September machine tool orders were revised upward to +11.0% year-on-year, marking the largest increase in six months [6]

Global Reserve Assets - Gold has surpassed the euro to become the 2nd largest global reserve asset [1]

Core Viewpoint - The dollar showed mixed performance against major currencies, remaining flat against the euro and yen while declining against the Swiss franc, indicating a cautious approach from investors in a risk-averse environment [1] Currency Performance - The dollar was flat against the euro and yen, suggesting stability in these currency pairs [1] - The dollar experienced a decline against the Swiss franc, highlighting a shift in investor sentiment towards safer assets [1] - Overall, the dollar's slight recovery indicates a temporary avoidance of risk by investors [1]

Economic and Currency Trends - The U.S. dollar is experiencing a decline, marking a third consecutive session of losses against major currencies such as the euro, yen, and Swiss franc, influenced by U.S.-China tensions and Federal Reserve remarks [1][2] - The dollar weakened by 0.49% to 0.793 against the Swiss franc, reflecting ongoing trade tensions and market uncertainty [2] - The dollar index fell by 0.33% to 98.35, with U.S. Treasury yields near multi-week lows, indicating pressure on the dollar amid a potential prolonged U.S. government shutdown [4] Federal Reserve Insights - Federal Reserve Governor Christopher Waller supports another interest rate cut at the upcoming policy meeting due to mixed job market signals [3] - The Fed's Beige Book indicates emerging economic weakness, including rising layoffs and reduced spending among middle and lower-income households, which may influence future rate decisions [4] U.S.-China Trade Relations - The dominant narrative remains U.S.-China trade tensions, with China increasing pressure ahead of a meeting between Presidents Xi Jinping and Donald Trump, raising questions about potential negotiation strategies [2] European Economic Developments - French Prime Minister Sebastien Lecornu survived two no-confidence votes, allowing him to deliver a budget and temporarily suspending controversial pension reforms, which positively impacted the euro, pushing it to a one-week high at $1.1688 [6]