News

Japan’s manufacturing sector contracted at its sharpest pace in 19 months in October, as weakening global demand and sector-specific slowdowns in autos and semiconductors weighed heavily on output, a private survey showed Tuesday.

The S&P Global Japan Manufacturing PMI fell to 48.2 in October from 48.5 in September, undershooting the flash estimate of 49.3 and marking the lowest reading since March 2024. The headline index has now remained below the 50.0 threshold — separating growth from contraction — for four consecutive months.

New orders declined at the quickest rate in 20 months, driven by tighter client budgets and sluggish demand both domestically and overseas. Export orders dropped for the 44th straight month, with particularly weak demand from Asia, Europe, and the U.S., though the rate of decline was the slowest since March:

• Demand weakness, particularly in the automotive and semiconductor sectors
• Input cost inflation accelerated to a four-month high, fuelled by rising labour, materials, and transport expenses
• output prices climbed to a three-month high as firms sought to protect profit margins.
• manufacturers grew slightly more optimistic about the year ahead, citing expectations for new product launches, AI adoption, and a recovery in global trade as potential stabilisers
• firms also hope that the impact of U.S. tariffs will fade over time.

The data come as inflation pressures remain elevated, with Tokyo’s CPI accelerating last week, keeping the Bank of Japan under scrutiny after holding rates steady at 0.5% in its latest policy meeting.

—

The sharp PMI drop underscores Japan’s export and industrial fragility, weighing on near-term yen sentiment and regional manufacturing outlooks. Persistent cost pressures could complicate the Bank of Japan’s efforts to normalise policy while growth slows.

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

Japan’s manufacturing sector contracted at its sharpest pace in 19 months in October, as weakening global demand and sector-specific slowdowns in autos and semiconductors weighed heavily on output, a private survey showed Tuesday.

The S&P Global Japan Manufacturing PMI fell to 48.2 in October from 48.5 in September, undershooting the flash estimate of 49.3 and marking the lowest reading since March 2024. The headline index has now remained below the 50.0 threshold — separating growth from contraction — for four consecutive months.

New orders declined at the quickest rate in 20 months, driven by tighter client budgets and sluggish demand both domestically and overseas. Export orders dropped for the 44th straight month, with particularly weak demand from Asia, Europe, and the U.S., though the rate of decline was the slowest since March:

• Demand weakness, particularly in the automotive and semiconductor sectors
• Input cost inflation accelerated to a four-month high, fuelled by rising labour, materials, and transport expenses
• output prices climbed to a three-month high as firms sought to protect profit margins.
• manufacturers grew slightly more optimistic about the year ahead, citing expectations for new product launches, AI adoption, and a recovery in global trade as potential stabilisers
• firms also hope that the impact of U.S. tariffs will fade over time.

The data come as inflation pressures remain elevated, with Tokyo’s CPI accelerating last week, keeping the Bank of Japan under scrutiny after holding rates steady at 0.5% in its latest policy meeting.

—

The sharp PMI drop underscores Japan’s export and industrial fragility, weighing on near-term yen sentiment and regional manufacturing outlooks. Persistent cost pressures could complicate the Bank of Japan’s efforts to normalise policy while growth slows.

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

Japan Jibun Bank Manufacturing PMI came in at 48.2, below expectations (48.3) in October

Equity index futures are trading lower while the USD has added a few points

Moves are not large.

I’m not seeing a direct smoking gun at present.

If you wanna tell me stock markets are overdue for a collapse, OK …. but why now?

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

Equity index futures are trading lower while the USD has added a few points

Moves are not large.

I’m not seeing a direct smoking gun at present.

If you wanna tell me stock markets are overdue for a collapse, OK …. but why now?

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

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.

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.

Standard Chartered says the recent pullback in gold prices below $4,360 per ounce represents a chance for investors to re-enter the market, arguing that the metal’s key bullish drivers remain firmly in place.

Despite the correction, gold is still up 49% over the past year, supported by

• a weaker U.S. dollar,
• robust central bank buying,
• and persistent inflation concerns across major economies.
• ongoing geopolitical risks, including wars and trade tensions

Said market “normalisation” may take several weeks but expects strong technical support between $3,945 and $4,060 per ounce

• firmly view this pullback as an opportunity to add
• projecting gold to reach $4,500 within 12 months

Analysts at bank added that, with the Dollar Index down nearly 8% year-to-date, structural tailwinds such as diversification away from fiat assets and continued central-bank accumulation are likely to underpin demand for gold into 2026.

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

Gold price (XAU/USD) declines to around $4,000 during the early Asian session on Tuesday. The precious metal edges lower as traders dialed back bets for further Federal Reserve (Fed) rate cuts. The Fed’s Michelle Bowman is scheduled to speak later in the day. 

President Trump also threatened to withhold federal funds from New York if Zohran Mamdani, a democratic socialist, wins Tuesday’s election.