News

EUR/USD depreciates after three days of losses, trading around 1.1550 during the Asian hours on Monday. The pair loses ground as the US Dollar (USD) receives support after Bloomberg reported the record-breaking US government shutdown is nearing an end.

Bank of Japan policymakers discussed the likelihood of a near-term rate hike at their October meeting, with most members leaning toward tightening if wage momentum and economic conditions stay supportive, according to a summary released Monday.

I put up a piece on the Summary earlier:

• BoJ Summary of Oct meeting highlights the importance of wages to future rate hikes

Reuters have a recap now, in summary:

Of the 13 policy opinions expressed by the nine-member board, eight called for a rate increase soon or outlined conditions that could justify one. Several members said the Bank must not “miss the timing” to raise its policy rate, while others said a move would depend on confirming that firms’ wage-setting momentum continues and that no major shocks hit the global economy or markets.

At the two-day meeting ending October 30, the BOJ kept its policy rate unchanged at 0.5%, though two members dissented in favour of a hike to 0.75%. Governor Kazuo Ueda said afterward he preferred to see “a bit more data” to confirm that companies will sustain pay increases despite the drag from higher U.S. tariffs.

The summary suggests the central bank is growing more confident about normalising policy but remains cautious about timing, with a focus on verifying wage resilience before taking the next step.

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

Japan Prime Minister Sanae Takaichi said on Monday that she will review target of achieving basic fiscal balance surplus and issue instructions at the stage in January.

The U.S. government shutdown has dragged on for weeks because of the refusal by Democrats in the Senate to approve a bill that does not extend ACA tax credits.

There are at least 8 votes from Senate Democratic caucus in favor of a negotiated deal to end shutdown

Reuters citing unnamed source. This is enough to end the shut down.

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The Senate is in recess until 8pm US Eastern time. It looks like there are now plenty enough votes to reopen the government. Not over ’til its over though I guess. I’ll keep tabs on this until the vote passes. Or not!

The bill will have to go to the House of course, and there is plenty of noise being made about how it’ll face opposition there. I suspect it’ll gt passed, there seems to be enough pressure on now.

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

Japan PM Takaichi:

• Won’t ditch govt primary balance target for fiscal 2025, but will examine new govt fiscal target for future that looks at fiscal state in scope of several years
• Govt must restore market trust in Japan’s finances but boosting investment is also needed to strengthen economic growth

Earlier:

• Japan’s Takaichi abandons annual budget target, takes softer fiscal consolidation stance

Despite what we hear from the pollies in Japan on a day to day basis this new government is proposing a lot of stimulus for the Japanese economy. Keep that in mind.

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

The record-breaking US government shutdown is nearing an end after a group of centrist Senate Democrats agreed to support a deal to reopen the government and fund some departments and agencies for the next year, Bloomberg reported on Monday.

People’s Bank of China USD/CNY reference rate is due around 0115 GMT.

The People’s Bank of China (PBOC), China’s central bank, is responsible for setting the daily midpoint of the yuan (also known as renminbi or RMB). The PBOC follows a managed floating exchange rate system that allows the value of the yuan to fluctuate within a certain range, called a “band,” around a central reference rate, or “midpoint.” It’s currently at +/- 2%.

How the process works:

• Daily midpoint setting: Each morning, the PBOC sets a midpoint for the yuan against a basket of currencies, primarily the US dollar. The central bank takes into account factors such as market supply and demand, economic indicators, and international currency market fluctuations. The midpoint serves as a reference point for that day’s trading.
• The trading band: The PBOC allows the yuan to move within a specified range around the midpoint. The trading band is set at +/- 2%, meaning the yuan could appreciate or depreciate by a maximum of 2% from the midpoint during a single trading day. This range is subject to change by the PBOC based on economic conditions and policy objectives.
• Intervention: If the yuan’s value approaches the limit of the trading band or experiences excessive volatility, the PBOC may intervene in the foreign exchange market by buying or selling the yuan to stabilize its value. This helps maintain a controlled and gradual adjustment of the currency’s value.

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

Goldman Sachs says the artificial intelligence investment cycle still has room to run, comparing today’s surge in AI spending and valuations to the early phase of the late-1990s tech boom rather than its speculative peak.

In a new report, the bank said that “on many metrics, the current AI-related boom has more in common with the tech boom in 1997/1998 than in 1999 or 2000.” That period marked the buildout stage of the internet era, when productivity and infrastructure gains were beginning to emerge but before market excesses took hold.

Goldman cautioned that strong returns on capital are not guaranteed, but said current trends suggest “plenty of room for the AI investment boom to run” provided no external shocks or funding constraints disrupt momentum.

The analysis implies that AI’s expansion phase could continue as companies invest heavily in data centres, semiconductors, and model training infrastructure. The bank’s framing reinforces the view that AI remains in its buildout stage — with parallels to the pre-dotcom frenzy years when long-term productivity gains were only starting to materialise.

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Goldman’s comparison to the pre-dotcom years reinforces optimism in AI-linked equities and infrastructure plays. The bank’s view could bolster sentiment across chipmakers, cloud providers, and data-centre developers seen as core to the current investment wave.

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

The U.S. government shutdown appeared close to ending after a group of centrist Senate Democrats agreed to support a stopgap deal to reopen key agencies and provide temporary funding.

• Under the proposal, federal employees would receive back pay and states would resume delayed federal transfers.
• The measure would fund certain departments through January 30, while others would receive full-year appropriations.

However, the bill faces a tough path in the House. Democratic leaders have spoken out against the compromise, arguing it concedes too much to Republicans. At the same time, conservative GOP lawmakers are pushing for a broader package that would fund the entire government through September 30, setting up another potential standoff.

The agreement marks the most serious bipartisan effort yet to end the protracted shutdown, though the political divisions underscore the difficulty of reaching a lasting budget deal.

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Earlier:

• Some media reports of reopening the US government
• Sunday session for US Senate as lawmakers seek band aid funding for 10% of government

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