MNI ASIA MARKETS ANALYSIS: Carry-Over Hawkish Tone Post FOMC

HIGHLIGHTS

• The ECB left its three key rates unchanged again, including the deposit rate at 2.00%, as fully expected.
• Treasuries look to finish lower, off lows, curves mildly steeper with projected rate cut pricing holding largely steady vs. Wednesday's post-FOMC levels.
• US$ price action has been underpinned by the market questioning the Fed’s December easing prospects, following Chair Powell’s acknowledgement that there are no foregone conclusions on another rate reduction.
• Gold has risen today after yesterday’s Trump-Xi meeting failed to completely ease fears around the trade war.

US TSYS

MNI US TSYS: Post-FOMC Retreat in Rates, ECB Held Steady

• Treasuries look to finish weaker, off morning lows, curves mildly steeper (2s10s +.522 at 48.089, 5s30s +1.245at 92.638), projected rate cut pricing hold near late Wednesday levels (* Post FOMC): Dec'25 at -18bp (-15.5bp), Jan'26 at -26.5bp (-26bp), Mar'26 at -35.1bp (-35.3bp), Apr'26 at -41bp (-42bp).
• Currently, the Dec'25 10Y contract trades -7 at 112-22 vs. 112-16 low, 10Y yield +.0193 at 4.0950% vs. 4.1144% high. The contract has traded through the 50-day EMA, at 112-27. This highlights potential for a deeper retracement near-term. An extension lower would open 112-06 Low Sep 25 and the next key support.
• The ECB left its three key rates unchanged again, including the deposit rate at 2.00%, as fully expected. The decision statement offered no surprises, noting general resilience with an expected caveat from the uncertain outlook whilst reiterating data-dependence and a meeting-by-meeting approach.
• Limited data on day 30 of the US Gov shutdown: The Dallas Fed's Weekly Economic Index slowed in the week of August to 2.00% in the week ending Oct 25 (scaled to 4-quarter growth), from 2.14% prior, marking a 20-week low.
• Look ahead to Friday: Data from BEA & BLS postponed due to the ongoing US Gov shutdown (day 30) - no Personal Income/Spending, PCE Prices or Employment Cost data tomorrow. Markets do get to see the latest Chicago PMI from MNI, and Fed speakers: Dallas Fed Logan bank funding conf (text, no Q&A) at 0930ET, Cleveland Fed Hammack & Atlanta Fed Bostic bank funding conf at 1200ET.

REFERENCE RATES
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US TSYS: Repo Reference Rates

• Secured Overnight Financing Rate (SOFR): 4.27% (-0.04), volume: $3.061T
• Broad General Collateral Rate (BGCR): 4.24% (-0.04), volume: $1.150T
• Tri-Party General Collateral Rate (TCR): 4.24% (-0.04), volume: $1.115T
• (rate, volume levels reflect prior session)

STIR: FRBNY EFFR for prior session:

• Daily Effective Fed Funds Rate: 4.12% (+0.00), volume: $98B
• Daily Overnight Bank Funding Rate: 4.12% (+0.00), volume: $189B

FED Reverse Repo Operation

RRP usage slips to $19.166B with 18 counterparties this afternoon from $19.504B Wednesday. Compares to $2.435B on October 24 (lowest level since mid-March 2021) and the year's highest usage of $460.731B on June 30.

US SOFR/TREASURY OPTION SUMMARY

SOFR/Treasury options still adjusting to post FOMC rate cut, heavier volumes leaning towards upside calls. Underlying futures weaker - off lows after $30B Meta 6part issuance launched, rate locks unwound curves inching steeper (5s30s +1.534 at 92.927). Projected rate cut pricing hold near late Wednesday levels (* Post FOMC): Dec'25 at -18bp (-15.5bp), Jan'26 at -26.5bp (-26bp), Mar'26 at -35.1bp (-35.3bp), Apr'26 at -41bp (-42bp).

SOFR Options
+5,000 0QZ5 97.50 calls, 1.5 vs. 96.92/0.10%
+15,000 SFRZ5 96.25/96.43/96.62 call flys, 4.75-5.5 ref 96.245
+4,000 SFRH6 96.75/97.00 call spds, 2.25 vs. 96.42/0.08%
+7,500 SFRG6 96.75/97.00/97.25 call flys, 1.0 vs. 96.41/0.05%
-5,000SFRZ5 96.18/96.31/96.37/96.50 call condors, 5.5 ref 96.25
-5,000 SFRF6 96.25/96.37put spds 
4,000 SFRZ5 96.18/96.37/96.43 iron fly, 11.25
-5,000 SFRH6 96.87/96.81/96.87/97.00 call condors, 0.75
Block, +12,500 SFRZ5 95.93/96.06 2x1 put spds, 0.5 vs. 96.185/0.05%
-40,000 2QH6 98.00/98.25 call spds, .25
+10,000 SFRH6 96.12/96.37 put spds .75 over 96.50/96.68 call spds
+5,000 SFRZ5 96.12/96.25/96.37/96.43 put condors, .75 ref 96.245
Update over 20,000 SFRZ5 96.25/96.31/96.43/96.50 call condors, 3.25 ref 96.24
50,000 SFRG5 97.25/97.50 call spds ref 96.425
Block, 4,450 SFRX5/SFRZ5 96.18 put spds 2.75
-2,500 SFRX5 96.25/96.31 strangles, 4.25
2,200 SFRH6 96.50/96.75 call spds vs. 96.31 puts, 0.0
Block, 10,000 SFRZ5 96.25/96.31 call spds, 3.50
-10,000 SFRZ5 96.25/96.37/96.50/96.62 call condors, 4.5 ref 96.245
4,000 SFRF6 96.37/0QF6 96.68 put spds, 1.5 
5,000 SFRX5 96.12/96.18 2x1 put spds, 0.75 ref 96.245
5,000 SFRM5 96.12/96.25/96.37 put trees ref 96.685
over 2,300 SFRM5 95.87/96.12/96.25/96.37 put condors ref 96.675
1,500 SFRZ5 95.87/96.06/96.18/96.31 put condors ref 96.245
Block, 7,984 SFRZ5 96.25/96.37/96.50 call flys, 4.0
3,000 SFRZ5 96.37 puts reff 96.245
over 12,000 SFRX5 96.12 puts, ref 96.245

Treasury Options
+30,000 TYZ5 114.5 calls, 4
-10,000 TYZ5 111.5 puts, 8
3,000 FVZ5 110/111 call spds, ref 109-03.25
30,000 FVZ5 110.5/111.5 call spds ref 109-05.75
-1,000 TYZ5 113 straddles, 100
over 6,100 USZ5 114 puts ref 117-25
over 7,800 TYZ5 113.5 calls 16 ref 112-26.5
over 6,300 TYZ5 113 calls, 24
over 7,400 TYF6 111 puts, 14 last
1,000 TYZ5 111.75/112.5/112.75/113.5 call condors ref 112-24
over 5,600 TYZ5 112 puts, 12-13 ref 112-25
-2,250 TYF6 111 puts, 14

MNI BONDS: EGBs-GILTS CASH CLOSE: Bunds Digest ECB Meeting Smoothly

Bunds outperformed Gilts amid broader weakness in global bonds Thursday.

• A more hawkish-than-expected Fed press conference late Wednesday saw a negative spill-over impact into Europe Thursday, stabilizing just ahead of the ECB decision.
• In data, Spanish and German flash inflation surprised to the upside. French flash Q3 GDP was stronger-than-expected, Germany was  broadly in line, while Italy surprised to the downside.
• The ECB release brought virtually no surprises and saw rate pricing little changed, with global FI picking up from session lows despite some hawkish tweaks to Lagarde’s press conference. The now typical Reuters sources piece later in the day pointed to a more contentious December meeting.
• MNI's review of the ECB decision is here.
• Bonds would regain ground for most of the rest of the session. On the day, Bunds marginally outperformed Gilts, which were weighed down by uncertainty over the political future of UK Chancellor Reeves; periphery / semi-core EGB spreads tightened modestly.
• Friday brings the Eurozone-wide October flash inflation print (and those of Italy and France).

Closing Yields / 10-Yr EGB Spreads To Germany

• Germany: The 2-Yr yield is up 1.2bps at 1.986%, 5-Yr is up 2.1bps at 2.253%, 10-Yr is up 2.2bps at 2.643%, and 30-Yr is up 1.1bps at 3.199%.
• UK: The 2-Yr yield is up 3bps at 3.796%, 5-Yr is up 3.6bps at 3.908%, 10-Yr is up 3.2bps at 4.424%, and 30-Yr is up 1.7bps at 5.181%.
• Italian BTP spread down 0.4bps at 75.6bps / French OAT down 0.6bps at 78bps  

MNI OPTIONS: Upside Trade Continues Through ECB Decision

Thursday's Europe rates/bond options flow included:

Pre-ECB decision:

• DUZ5 107.10/107.30/107.50c fly, bought for 2 in 10k
• OEZ5 117.5/118.5^^, bought for 19 up to 19.5 in 4.5k
• RXZ5 131/131.5cs, bought for 3 in 2k
• RXZ5 130.5/131.5cs, bought for 9 in 10k.
• SFIF6 96.55/96.70/96.75/96.90c condor, bought for 2 in 3.5k

Post-ECB:

• ERH6 98.00/98.12/98.25c ladder vs 97.9375p, bought the ladder for 0.75 in 3.75k
• SFIF6 96.45/96.55cs vs 96.30p, bought the cs for 1.75 in 2k 

MNI FOREX: USD Index Consolidating Lurch Higher, Pressure on JPY Remains

• Post-Fed optimism for the US dollar has extended on Thursday, with the USD index (+0.32%) notably rising to the highest level since August 01. Price action has been underpinned by the market questioning the Fed’s December easing prospects, following Chair Powell’s acknowledgement that there are no foregone conclusions on another rate reduction.
• The greenback rally has been most notable against the Japanese yen, following the Bank of Japan remaining on hold and failing to provide any explicit signals regarding a December hike. The broad JPY weakness has prompted USDJPY to rally to fresh 8-month highs, reaching an intra-day peak of 154.45, an impressive 229 pips off initial session lows. Sights are on 154.80 next, the Feb 12 high.
• Elsewhere, GBP continued its run of poor form, with cable breaking a significant technical support level through 1.3140. Given the multiple daily lows and the significance of the level, market participants will quickly turn their attention to potential targets of a more protracted move lower. Ongoing fiscal concerns have been exacerbated on Thursday by rising uncertainty over Chancellor Reeve’s future amid new information coming to light surrounding a breach of housing rules.
• Downside levels for cable include 1.3041, the Apr 14 low and 1.2971, the 1.382 projection of the Sep 17 - 25 - Oct 1 price swing. Below here, the April 07 low is located at 1.2709. EURGBP has had a steadier session around 0.88, with topside targets for the ongoing rally include 0.8835 and 0.8875, the April 2023 high.
• The broad greenback strength has tilted EURUSD back below 1.16, narrowing the gap to 1.1542, the Oct 9 low. Clearance of this level would confirm a resumption of the bear cycle that started Sep 17, opening 1.1516, a Fibonacci retracement.
• Further Eurozone inflation data highlights the Friday calendar. China manufacturing and non-manufacturing PMIs are also scheduled, before Canada August GDP.

MNI OPTIONS: Expiries for Oct31 NY cut 1000ET (Source DTCC)

• EUR/USD: $1.1515(E518mln), $1.1620-25(E653mln), $1.1715(E767mln)
• AUD/USD: $0.6600(A$888mln)
• USD/JPY: Y152.50($1.2bln), Y153.50($541mln), Y154.00($513mln), Y154.50($540mln), Y155.00($626mln)
• USD/CAD: C$1.3850($1.0bln), C$1.3900($733mln), C$1.3950($782mln)

MNI US STOCKS: Late Equities Roundup: Paring Gains, DJIA Still Outperforming

• Stocks remain mixed late Thursday, the DJIA modestly higher vs. weaker SPX eminis and Nasdaq. Currently, the DJIA trades up 46.66 points (0.1%) at 47,676.8, S&P E-Minis down 40.75 points (-0.59%) at 6,881.5 vs. record high of 6,953.75 this morning, Nasdaq down 269.2 points (-1.1%) at 23,688.66.
• A mix of Health Care, Industrials and Communications sector shares led late session advances: CH Robinson Worldwide +19.11%, Moderna +16.96%, Cardinal Health +13.63%, Fox +9.70%, AMETEK +8.17%, Rollins +7.05% and Huntington Ingalls Industries +6.56%.
• Conversely, Consumer Discretionary and Information Technology sector shares underperformed, the former weighed by Chipotle Mexican Grill -17.13%, , eBay -14.42%, Tesla -4.08% and DoorDash -4.01%.
• Tech sector shares came under pressure after Microsoft disclosed its OpenAI investment reduced quarterly earnings by $3.1 billion: Oracle Corp -4.78%, Synopsys -3.59%, Microsoft -3.37%, KLA -2.69% and Broadcom -2.51%.
• Also of note, Nvidia trades -1.69% after announcing it became the first company in history to reach $5T market capitalization. Meta Platforms -11.28% in late trade after issuing $30B in corporate debt over 6 tranches - 5th largest on record (matching $30B AbbVie jumbo 10-part on 11/12/19, and $30B ATT/Discovery 11pt via Magallanes inc on 3/922). 

MNI EQUITY TECHS: E-MINI S&P: (Z5) Bull Cycle Remains Intact

• RES 4: 7000.00 Psychological round number
• RES 3: 6993.12 3.500 proj of the Aug 20 - 28 - Sep 2 price swing
• RES 2: 6974.04 3.382 proj of the Aug 20 - 28 - Sep 2 price swing
• RES 1: 6953.75 Intraday high
• PRICE: 6874.00 @ 1504 ET Oct 30
• SUP 1: 6812.25/6780.35 High Oct 9 / 20-day EMA
• SUP 2: 6676.22 50-day EMA
• SUP 3: 6540.25 Low Oct 10 and a key short-term support
• SUP 4: 6506.50 Low Sep 5

The trend condition in S&P E-Minis remains bullish and price continues to trade closer to its recent highs. The fresh cycle high confirms a resumption of the primary uptrend and maintains the bullish price sequence of higher highs and higher lows. Sights are on 6974.04 next, a Fibonacci projection point. Initial firm support to watch lies at 6748.48, the 20-day EMA. A pullback would be considered corrective.

MNI COMMODITIES: Precious Metals Rebound, Crude Steady

• Gold has risen today after yesterday’s Trump-Xi meeting failed to completely ease fears around the trade war.
• Spot is currently up by 2.1% at $4,011/oz, leaving price around 8.5% below last week’s all-time high of $4,381.5.
• President Trump’s meeting with President Xi stopped short of a comprehensive agreement, although China did agree to pause its rare earth licensing regime for at least a year, while the US will halve its fentanyl tariffs immediately.
• The recent retracement in gold has allowed an overbought trend to unwind. Price remains below the 20-day EMA at $4,025.6, signaling scope for a deeper retracement towards the 50-day EMA, at $3,852.7.
• Initial resistance is at $4,161.4, the Oct 22 high.
• Meanwhile, silver has also rebounded by 2.8% to $48.9/oz, leaving price around 10% below this month’s record high.
• Trend signals in silver are bullish, and the recent sharp pullback is considered corrective. Attention is on support at the 50-day EMA, at $45.849. It remains intact but a break would signal scope for a deeper retracement.
• Initial resistance is at $49.456, the Oct 23 high.
• Elsewhere, crude has reversed earlier slight losses, with the market weighing the impacts of US sanctions on Rosneft/Lukoil against oversupply concerns ahead of OPEC’s meeting on Sunday.
• WTI Dec 25 is up by 0.1% at $60.5/bbl.
• Initial resistance is at $62.34, the Oct 8 high, while key support and the bear trigger has been defined at $55.96, the Oct 20 low.

FRIDAY DATA CALENDAR

Date	GMT/Local	Impact	Country	Event
31/10/2025	0700/0800	**	DE	Import/Export Prices
31/10/2025	0700/0800	**	DE	Retail Sales
31/10/2025	0730/0830	**	CH	Retail Sales
31/10/2025	0745/0845	***	FR	HICP (p)
31/10/2025	0745/0845	**	FR	PPI
31/10/2025	0930/0930		GB	Blue Book / Pink Book
31/10/2025	1000/1100	***	EU	EZ HICP Flash
31/10/2025	1000/1100	***	EU	EZ HICP Flash
31/10/2025	1000/1100	***	IT	Italy Flash Inflation
31/10/2025	1000/1100	***	EU	EZ HICP Flash
31/10/2025	1230/0830	***	CA	Gross Domestic Product by Industry
31/10/2025	1230/0830	***	US	Personal Income and Consumption
31/10/2025	1230/0830	***	US	Employment Cost Index
31/10/2025	1230/0830	***	CA	Gross Domestic Product by Industry
31/10/2025	1330/0930		US	Dallas Fed's Lorie Logan
31/10/2025	1342/0942	***	US	MNI Chicago PMI
31/10/2025	1500/1100		CA	Finance Dept monthly Fiscal Monitor (expected)
31/10/2025	1600/1200		US	Fed's Beth Hammack, Raphael Bostic
31/10/2025	1700/1300	**	US	Baker Hughes Rig Count Overview - Weekly
31/10/2025	1700/1300	**	US	Baker Hughes Rig Count Overview - Weekly
31/10/2025	1700/1300	**	US	Baker Hughes Rig Count Overview - Weekly