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Front-end Treasury yields are the cleanest expression of this view, since two more hikes would keep pressure on two-year yields, and BofA's rates strategists already lean that way. A firmer rate path supports the dollar, which rose this week by the most in three months, and adds to the pressure on rate-sensitive equities and long-duration assets. October becomes the pivotal Fed meeting, as a hold would challenge BofA's call and a hike would confirm it. Energy-driven inflation prints matter most from here, because they decide whether the supply-shock story fades or keeps feeding into demand.

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Earlier:

• Fed's first hike since 2023: what history says about the S&P 500 over the next year
• Weeeknd - Fed's Kashkari says inflation still too high…

Oil started the week with a risk premium, gapping higher, but has since subsided lower. This alert would seem to add to the sense that Washington is preparing for the possibility of escalation, but warnings of this kind have been issued repeatedly and are not a decision in themselves.

The clearer price driver is the binary choice Trump has described between military action, continued economic pressure or a deal, which puts the UN General Assembly week at the center of oil and gas risk. A credible move toward talks would ease the premium, while any strike or new attack on Gulf infrastructure would extend it. The mention of airspace closures is worth watching for regional aviation and shipping, which feed into fuel demand and freight costs.

<p…

The PBOC allows the yuan to fluctuate within a +/- 2% range, around this reference rate. More here on this.

• 6.7487 is the strongest for CNY since 3 February, 2023
• PBoC injects 165bn yuan via 7-day reverse repos at 1.40%

more to come 

This article was written by Eamonn Sheridan at investinglive.com.

The gap between Goldman's base case and its risk case is wide, so gas is pricing a genuine two-way bet on Hormuz flows, and any sign of LNG loadings improving or stalling could move both benchmarks quickly. Higher gas would support coal where switching is possible, which links the gas story to broader energy demand. It also feeds through to European inflation, which matters for central banks already debating further tightening. Oil traders should watch the same shipping headlines, because the strait is the shared risk for crude and LNG alike.

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Earlier:

• Oil opens higher on Globex as traders weigh Houthi missile attack on Riyadh

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Goldman says this winter's gas price depends on Hormuz LNG flows, with a stalled recovery pushing Europe and…

The fixing mechanism matters most right now because of what it has been signalling over recent weeks. The PBOC set its reference rate at the widest weak side deviation from market estimates in six months in late August, after the yuan touched a three and a half year high, a clear sign of discomfort with the pace of gains rather than the level itself. Traders should read this as the central bank applying the brakes rather than attempting to reverse the broader trend, since the yuan has still risen a meaningful amount against the dollar this year. The balancing act Beijing faces is straightforward: a stronger currency helps with capital stability and import costs, but too rapid a rise risks eroding export competitiveness at a time when the…

The tone is constructive, but the reported outcomes are procedural and no tariff rates or purchase volumes have been given, so markets are unlikely to treat this as a breakthrough. US energy and agricultural exporters are the obvious sentiment beneficiaries if goods in those categories end up on the final Board of Trade list, though that depends on Chinese demand and tariff treatment that has yet to be spelled out. The emphasis on consumer and low-tech items suggests tariff relief is aimed at non-strategic goods, leaving the sensitive areas of chips and rare earths outside the mechanism for now. With the November 10 truce expiry unaddressed in the comments reported so far, headline risk remains for the summit.

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Earlier:

• China holds loan…

The new yen longs were built before a week that went against them, so a position squeeze is the near-term risk if the yen keeps sliding, especially with Tokyo closed for Silver Week and liquidity thin. Against that, any official action would now land on a market leaning the other way, which could amplify a yen rebound. That leaves USD/JPY with two-way risk around the 157 area in the sessions ahead. The next weekly positioning report will show whether funds held or cut their yen longs after Friday's move.

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Hedge funds flipped to net long the yen just before hikes from the Fed and BOJ, a Friday sell-off and a reported BOJ rate check tested their conviction.

Summary:

• Hedge funds turned positive on the yen for the first time since July 2025,…

The practical read for traders is that the pace of the bond move is a live risk variable, not just the level. A further sharp jump in the 10-year yield of the kind Goldman associates with equity stress would be the clearest warning sign, so daily Treasury moves deserve as much attention as the Fed calendar. Rate-sensitive pockets such as housebuilders and long-duration growth stocks would be the first to react to such a move. Financials sit on the other side of that trade.

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Goldman's message is that stocks tend to wobble when the Fed starts hiking and recover within a year, but how fast long-dated yields rise matters as much as where they end up.

Summary:

• Goldman Sachs Research says the S&P 500 has averaged a 2% decline over three months…

For markets these comments are sentiment rather than a data point. Nvidia sits at the center of the AI trade, and regulation is the channel through which safety concerns could most plausibly reach earnings and valuations. Huang leads the biggest supplier of AI processors and so has an obvious commercial interest in his stance, which investors will weigh accordingly. Unease voiced from inside the industry is more likely to move sentiment than near-term chip demand, so the AI trade probably responds more to spending, earnings and policy headlines than to the safety debate itself.

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Huang has put a firm 0% on AI ending the world by 2030, arguing the industry should keep moving fast and ship only safe products, even as an Anthropic…

Graph is via the folks at Trading Eocnomics. 

Higher neutral-rate estimates are a structural argument for keeping long-dated yields elevated, which helps explain why bonds have sold off even with central banks already tightening. That matters for the curve and term premium more than for near-term policy moves. It also cuts against pricing that assumes a quick return to lower rates once inflation eases, since a higher resting point leaves less room for cuts. Equities have coped so far, but sustained pressure on long yields would test valuations, so traders will focus on whether yields rise on growth or on debt concerns.

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Economies are absorbing higher borrowing costs, and the neutral rate is the yardstick economists are using to argue…

The higher open fits a market rebuilding risk premium on Saudi supply after a run of strikes, and smoke near the capital's airport shifts the perceived boundary of the conflict even without reported damage. The Yanbu claim would matter more for flows than the Riyadh incident if verified, because it points at Saudi Arabia's Red Sea export outlets, the alternative to the Gulf route. Washington's signal that it will not join offensive strikes cuts both ways: it lowers the odds of a broader escalation, but leaves the Houthi campaign against Saudi Arabia unchecked in the near term. Traders will look to the Asian open to see whether the bid holds, since thin Sunday-evening trade can exaggerate a headline-driven move.

--- Oil is bid on the open…

The hold was fully priced, with all 21 economists surveyed forecasting no change, so the direct market reaction should be limited. The more useful signal is the yield gap. The premium on 10-year US Treasuries over Chinese government bonds is hovering near a record high after the Fed hike, which typically puts pressure on the yuan, yet reports say the currency has continued to strengthen, so watch whether that holds. With the PBOC's rate tools looking constrained, traders may focus on liquidity measures, such as a reserve requirement ratio cut, as the more likely form of any easing. A weak run of growth data would be the main thing that could revive rate-cut expectations.

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China's loan prime rates have sat still for 16 months, and with…