News

Minneapolis Fed President Neel Kashkari speaking at a ‘town hall’ event.

• Too soon to know the effect of tariffs on inflation
• Impact of tariffs taking longer to be felt than had guessed
• Expect services inflation to trend down, possible that goods inflation could spill over
• Job market is slowing down
• Its challenging to read signals without core government data because of the shut down
• Most folks say they are still concerned about inflation
• Fed prioritizing labor market over inflation control could lead to bad outcomes for workers
• Private credit bears watching; cautious about if it’s suitable for a 401k
• Leaders on both sides of the aisle believe in an independent Fed
• Pleased to see Supreme Court in May said Fed was a unique institution
• US economy is far and away the strongest economy in the world
• Immigration is a tool for economic growth, should we choose to use it
• Housing affordability crisis can’t be solved by interest rate cuts; need more housing supply
• More risk of labor market negative surprise than an uptick in inflation
• We are likely betting the economy is slowing more than it really is
• Take concerns about soy beans very seriously, but not something the Fed can do something about

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

The recent uptick in the Secured Overnight Financing Rate (SOFR) above the Federal Funds rate has drawn attention as a sign of tightening liquidity in short-term U.S. funding markets. Normally, SOFR trades below Fed Funds because Treasury-backed borrowing is considered safer than unsecured interbank lending. Its inversion suggests banks are showing a stronger preference for immediate liquidity and high-quality collateral.

–

I’ve seen some alarm over this, and I don’t think that is entirely misplaced. But, for now, I’ll keep it on an even keel here. Dance close to the door though, OK?

–

Analysts stress this development does not signal a crisis, but points to reduced reserve elasticity within the financial system. Several indicators reinforce this interpretation:

• Reverse repo balances have fallen sharply, implying the surplus of cash in money markets has largely dissipated.

• Usage of the Standing Repo Facility (SRF) has risen, indicating that banks are quietly tapping the Fed’s liquidity window.

• With SOFR now above the policy rate, the cost of secured overnight funding has exceeded the Fed’s theoretical ceiling, reflecting a strain in market plumbing rather than outright stress.

The move suggests an uneven distribution of reserves or a temporary shortage of collateral where it is most needed. Historically, similar divergences have preceded episodes of funding volatility but not always systemic risk.

If sustained, a higher SOFR effectively tightens financial conditions, adding a mild deflationary impulse even without policy changes. Analysts say this dynamic could eventually influence the timing of the Fed’s next easing cycle, if liquidity pressures persist.

—

The shift adds to signs that U.S. liquidity conditions are tightening, with money-market rates diverging from the Fed’s policy corridor. Traders are watching for potential repo volatility or earlier-than-expected policy recalibration if the pressures persist.

—

I should add in, if you need …

• SOFR is the benchmark interest rate for overnight loans that are secured by U.S. Treasury securities. In simple terms, it reflects how much it costs banks and big financial institutions to borrow cash overnight using Treasuries as collateral.
• SOFR replaced LIBOR (the London Interbank Offered Rate) as the main reference rate in the U.S. after LIBOR was phased out due to manipulation scandals.

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

China has accused the United States of deliberately fuelling global panic over its new rare earth export controls, rejecting U.S. calls to roll them back and denouncing comments from senior American officials as “grossly distorted.”

Commerce Ministry spokesperson He Yongqian said Washington had exaggerated Beijing’s policy shift, insisting the measures were consistent with international norms and that compliant, civilian-use exports would still be approved.

The new licensing regime, taking effect November 8, has unsettled global supply chains amid confusion over its scope. The People’s Daily published a seven-point rebuttal, accusing the U.S. of hypocrisy for maintaining its own control list of more than 3,000 items.

The dispute escalated after Treasury Secretary Scott Bessent and U.S. Trade Representative Jamieson Greer accused Beijing of a “global supply-chain power grab.” China condemned Bessent’s personal attack on trade envoy Li Chenggang and urged Washington to “correct its wrongdoings.”

While both sides have avoided new tariffs, the renewed war of words threatens to strain Trump–Xi relations ahead of their planned meeting in South Korea later this month.

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

HSBC expects the current bullish momentum in gold to extend through 2026, underpinned by a mix of strong central bank buying, persistent U.S. fiscal worries, and expectations of further monetary easing.

In a commodities outlook, the bank said gold remains well supported by robust investor sentiment and ongoing diversification by official institutions.

• continue to see rallies being sustained into 2026, driven by structural and macro factors that favour gold ownership

The report highlighted that U.S. fiscal deficit concerns are a significant driver of gold demand, with investors increasingly viewing bullion as a hedge against debt sustainability risks and potential U.S. dollar weakness.

HSBC also sees central bank gold purchases staying elevated, noting that demand from emerging-market central banks remains a key tailwind. The bank said institutional accumulation is unlikely to slow given ongoing geopolitical fragmentation and the desire to reduce reliance on the U.S. dollar.

However, the bank cautioned that gold’s upward trajectory could face headwinds if the Federal Reserve delivers fewer rate cuts than markets currently expect. A slower easing cycle could strengthen the dollar and lift yields, tempering gold’s near-term upside before broader bullish forces reassert.

Overall, HSBC maintains a positive medium-term outlook, projecting that dips will be well supported by strategic demand and macro uncertainty.

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

Trump spoke about price reductions on weight loss drugs:

• Trump says he thinks the price of fat loss drugs will fall

Following up now, noting the share price falls for the two pharma giants.

• Trump specifically mentioned Ozempic, calling it “the fat loss drug” … on prices for the drug he said “They’ll be much lower. They’ll be much lower”, adding prices would “come down pretty fast”
• no specific timeline was provided

Novo Nordisk makes Ozempic and Wegovy

• Eli Lilly, Mounjaro and Zepbound

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

South Korea Import Price Growth (YoY) up to 0.6% in September from previous -2.2%

South Korea Export Price Growth (YoY) increased to 2.2% in September from previous -1%

The procedure is often not fully covered by insurance — if covered at all — and the costs for accessing it can cost around $20,000 or more per cycle.

The attack prompted an emergency directive from the Cybersecurity and Infrastructure Security Agency.

Trump is rambling on re all sorts of topics. This one hitting the after hours price of weight loss drug makers:

• Think the “fat-loss drugs” will be a lot lower in price

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