MNI US OPEN - Senate Takes Crucial Step to End Shutdown

Nov-10 10:33By: Hiren Ravji

EXECUTIVE SUMMARY

CENTRIST DEMOCRATS BREAK W/LEADERSHIP TO REOPEN GOVT, SECURE SMALL WINS
US AND CHINA STEP BACK FROM SHIPPING PROBES AS TENSIONS EASE
BOJ NAKAGAWA SEES HIKES, BUT NO TIMING HINT
CHINA OCT CPI UNEXPECTEDLY RISES ON HOLIDAY DEMAND

Figure 1: Betting market odds of US government shutdown ending this week surge

Source: Polymarket

NEWS

US (MNI) Centrist Democrats Break w/Leadership to Reopen Govt, Secure Small Wins

Eight centrist Democrats yesterday took the first step toward reopening the government, voting with Republicans on a new Continuing Resolution to fund the US government through January 30. The package provides backpay to furloughed federal workers and includes a three-bill Fiscal 2026 appropriations package covering Agriculture, Rural Development, and FDA, Military Construction and Veterans Affairs, and Legislative Branch.

The deal includes a commitment for a Senate vote in December on renewing the expiring ACA tax credits, but as it does not include a commitment from President Donald Trump or House Speaker Mike Johnson (R-LA), it is unlikely to pass, especially considering Trump's recent activity on social media decrying the ACA as a 'scam'. Senate Republican leadership are eying final passage today, but Senate Minority Leader Chuck Schumer (D-NY) is unlikely to provide the votes to fast-track the process. The government is likely to be reopened on Wednesday, at the earliest.

US/CHINA (BBG): US and China Step Back From Shipping Probes as Tensions Ease

The US and China suspended port fees on each other’s ships for one year and paused probes into maritime practices, in another sign of easing tensions between the world’s two largest economies. The Trump administration paused a probe into China’s shipbuilding industry, and in turn, Beijing said it was shelving its own investigation and putting off special port fees on US vessels. China also said that it put on hold sanctions on US units of a major South Korean shipbuilder, Hanwha Ocean Co.

US (WSJ): Trump Suggests $2,000 Payouts to Americans as He Defends Tariffs

President Trump suggested tariff revenue could be used to fund payments of at least $2,000 to most Americans. Days after the Supreme Court appeared skeptical of the legal backing for many of his tariffs, the president on social media Sunday lauded the revenue they have brought in and said the government would soon begin paying down the country’s debt. He also said a payment of at least $2,000 would be made to everyone but high-income earners.

EU/UK (FT): Von der Leyen Dodged Starmer Request for Meeting on EU Money Demands

European Commission president Ursula von der Leyen dodged a meeting with the UK Prime Minister Sir Keir Starmer at COP30 in Brazil about Brussels’s demand that London pay billions of euros to secure improved ties. The British leader sought the meeting to complain about EU demands that the UK pay up to €6.5bn to participate in a loans-for-weapons programme and make separate contributions to the EU budget, according to two people briefed on the situation.

UK (The Telegraph): Reeves Plans Raid on Stocks and Shares

Rachel Reeves is poised to increase the tax rate on earnings from shares in her Nov 26 Budget, The Telegraph understands. The Chancellor is expected to put up the rate of dividend tax in a move that will hit investors but could raise up to £2bn. It comes as part of a drive by Labour to ensure that income from wealth is taxed more equally to earnings made from work. It is expected to raise concerns that people will be put off investing, while pensioners who rely on extra income from shares will also lose out.

BOJ (MNI): BOJ Nakagawa Sees Hikes, But No Timing Hint

Bank of Japan board member Junko Nakagawa said Monday the Bank will continue raising the policy interest rate and adjusting the degree of monetary accommodation in line with improvements in economic and price developments. Nakagawa, however, gave no indication of when the next rate hike might occur. “Considering that high uncertainties remain regarding the impact of trade and other policies in each jurisdiction, the Bank will make monetary policy decisions as appropriate by continuing to carefully assess data and information that becomes available,” Nakagawa, regarded as a neutral board member, told business leaders in Okayama City.

ECB (BBG): ECB’s Guindos Says Current Level of Interest Rates Is Right

European Central Bank Vice President Luis de Guindos said the current level of euro-zone borrowing costs is appropriate but officials must remain cautious. In an interview with Portuguese newspaper Diário de Notícias, Guindos said inflation will be “very close” to the 2% target. While the economy is still displaying “very low” growth that’s below its 1%-1.5% potential, it’s at least dodged a recession, he said.

BOJ (MNI): Members See Rate Hike, But No Imminent Move - BOJ Opinions

Bank of Japan board members largely agreed on the need to raise the policy interest rate eventually, but saw no urgency to act at the Oct 29-30 meeting, preferring to confirm sustained wage momentum and the firmness of underlying inflation, according to the summary of opinions released Monday. “The momentum of initial moves toward next year's annual spring labour-management wage negotiations will be an important factor for the Bank to consider in making policy decisions,” one member said at the meeting, which resulted in a pause to the 0.5% policy rate.

BOJ (MNI INTERVIEW): BOJ Dec Hike Needed to Support Yen - Sakurai

A former BOJ board member shares his policy rate outlook. On MNI Policy MainWire now, for more details please contact sales@marketnews.com

RBA (BBG): RBA’s Hauser Says Economy’s Capacity Limits Challenge Policy

Australia’s monetary policy is being challenged by an apparent lack of spare capacity in the economy, Reserve Bank Deputy Governor Andrew Hauser said, a week after policy makers signaled an extended interest-rate pause. Recent data showing unexpectedly stubborn inflation and inching-up unemployment underscore the need for greater investment and higher productivity, Hauser said Monday in the text of a speech that was heavy on horse racing analogies following last week’s Melbourne Cup.

DATA

CHINA DATA (MNI): China Oct CPI Unexpectedly Rises on Holiday Demand

China’s Consumer Price Index unexpectedly rose 0.2% y/y in October, reversing September's 0.3% fall and beating expectations for a 0.1% drop, as policies kicked in and week-long holidays drove demand, according to data from the National Bureau of Statistics released Sunday. On a monthly basis, CPI rose 0.2%, edging up from September's 0.1% growth. Core CPI, which excludes food and energy, rose 1.2% from September's 1.0%, marking the sixth consecutive month of increase and reaching its highest level since Mar 2024.

NORWAY DATA (MNI): CPI-ATE 4 Tenths Above Consensus, 2 Tenths Above Norges Bank’s Forecast

NORWAY OCT CPI-ATE +0.6% M/M, +3.4% Y/Y
NORWAY OCT CPI +0.3% M/M, +3.3% Y/Y

That upside surprise of 0.4ppt to consensus for CPI-ATE leaves us 0.2ppt above the Norges Bank's latest forecast. We had noted following last week's Norges Bank meeting that a December cut seemed very unlikely at this stage, and the prospects of that are likely to fall back even further. It appears as though the upside pressure is concentrated across "furnishings, household equipment and route maintenance", "clothing and footwear" and "recreation and culture" at first glance.

RATINGS: Greece Gets +ve Outlook at Scope, -ve Outlook Tweak for Poland at DBRS

Sovereign rating reviews of note from after hours on Friday include:

Fitch affirmed Ireland at AA; Outlook Stable
Fitch affirmed Latvia at A-; Outlook Stable
S&P affirmed Poland at A-; Outlook Stable
Morningstar DBRS confirmed Poland at A, Trend changed to Negative
Scope Ratings affirmed Greece at BBB; Outlook revised to Positive

FOREX: Pro-Growth Expectations on Shutdown Optimism Favour AUD, Hamper JPY

A pro-growth impulse from expectations for the US government reopen potentially this week has led the USD to consolidate last week's losses. Reactions across G10 do not surprise, with positive risk sentiment apparent through strong equity performance weighing on the low-yielding JPY and CHF while supporting the likes of AUD, NZD and NOK.
USDJPY subsequently sees renewed upside today, clearing Friday's highs and approaching the Nov 4 high at 154.48, the bull trigger. A break of this level would confirm a resumption of the uptrend and open 154.80, the Feb 12 high. First important support lies much further out at 152.46, the 20-day EMA.
AUD received further tailwinds from RBA Hauser comments being on the hawkish side. For AUDUSD (+0.68%), a break above key resistance at 0.6618 (Oct 29 high) would be required to reinstate a bullish theme.
NOK meanwhile also benefits from an upside surprise to domestic October CPI. A December cut was already unlikely following last week's Norges Bank meeting and the prospects of that are likely to fall back even further. EURNOK has extended the pullback from 11.80, potentially forming a double top pattern multi-week.
ZAR outperforms in emerging market FX, very much a product of the precious metals rally (gold +2%), which adds further support to the positive risk backdrop and consolidating dollar weakness.
Key to watch in the days ahead will be further developments on the shutdown, with a handful of legislative hurdles still to be met: Senate is yet to formally schedule a vote final passage, and a House vote will have to follow. Comments from Fed’s Daly & Musalem, as well as BoE’s Lombardelli, headline a limited G10 calendar today.

BONDS: Off Lows on Peripheral & OAT Demand Stemming From Risk-On Price Action

Tentative movement towards the reopening of the U.S. government has boosted border risk sentiment.

This initially weighed on core global FI markets before outperformance for peripheral EGBs & OATs helped wider core global FI markets off lows.
Gilt and Bund futures have retraced much of their move lower, while OAT & BTP futures are now higher on the day.
Bund futures -9 at 129.03 vs. session lows of 128.80. Initial support at 128.96/92 was breached, but Fibonacci support at 128.52 went unchallenged. Bears remain in short-term control.
German yields are 0.5-1.5bp higher, now bear flattening after bear steepening at the open.
EGB spreads to Bunds 0.5-2.0bp tighter, OATs outperform with the spread vs. 10-Year Bunds ~77.5bp.
No outperformance for Greece evident after a move to Positive outlook at Scope Ratings on Friday.
Gilt futures base at 92.75 before recovering to 93.09, -12.
UK yields little changed to 0.5bp higher across the curve.
Short end pricing little changed when looking at the bigger picture. ~40% odds of one further ECB cut priced for this cycle, while GBP markets price ~17bp of easing through year-end and fully discount the next BoE cut come the end of the Feb meeting.
Little of note on the European & UK calendars today.
Labour market data (due tomorrow) headlines this week’s UK calendar.

EQUITIES: Medium-Term Bull Trend in Eurostoxx Futures Intact

A medium-term bull trend in Eurostoxx 50 futures remains intact and recent weakness is considered corrective. Price has managed to find support below two important price points; the 50-day EMA, at 5576.77, and 5571.50, the base of a bull channel drawn from the Aug 1 low. A clear break of both levels would strengthen a bear theme and highlight a stronger reversal. The bull trigger is 5742.00, the Oct 29 high. The trend condition in S&P E-Minis remains bullish and the pullback since the Oct 30 high appears corrective. The contract has managed to find support below the 50-day EMA, currently at 6710.28 and a key support. Friday’s activity also highlights a potential reversal signal - a bullish doji candle. This defines key support at 6655.50, the Oct 7 low. A continuation higher would signal the end of a correction and open 6953.75, Oct 30 high and bull trigger.

Japan's NIKKEI closed higher by 635.39 pts or +1.26% at 50911.76 and the TOPIX ended 18.57 pts higher or +0.56% at 3317.42.
Elsewhere, in China the SHANGHAI closed higher by 21.041 pts or +0.53% at 4018.597 and the HANG SENG ended 407.23 pts higher or +1.55% at 26649.06.
Across Europe, Germany's DAX trades higher by 410.03 pts or +1.74% at 23978.42, FTSE 100 higher by 83.98 pts or +0.87% at 9766.47, CAC 40 up 110.91 pts or +1.4% at 8061.11 and Euro Stoxx 50 up 94.47 pts or +1.7% at 5661.04.
Dow Jones mini up 206 pts or +0.44% at 47292, S&P 500 mini up 66 pts or +0.98% at 6820, NASDAQ mini up 387.25 pts or +1.54% at 25555.

Time: 10:05 GMT

COMMODITIES: Downleg in Gold That Started Oct 20 Appears to Have Been Correction

Recent weakness in WTI futures appears to be a flag formation - a bullish continuation pattern. This suggests that a bullish corrective cycle remains intact for now. Price has recently traded through the 50-day EMA, at $60.87, signalling scope for a stronger recovery. Note too that resistance at $62.34, the Oct 8 high, has been pierced. A clear move through it would expose key resistance at $65.77, Sep 26 high. The bear trigger is $55.96, the Oct 20 low. The downleg in Gold that started Oct 20 appears to have been a correction and has allowed an overbought condition to unwind. Price remains above a key support area at the 50-day EMA, at $3880.7. Clearance of this EMA would strengthen a short-term bear theme and signal scope for a deeper retracement. Initial resistance is at $4161.4, the Oct 22 high. A stronger recovery would refocus attention on $4381.5, the Oct 20 high and bull trigger.

WTI Crude up $0.64 or +1.07% at $60.38
Natural Gas up $0.19 or +4.43% at $4.506
Gold spot up $79.14 or +1.98% at $4080.24
Copper up $8.7 or +1.76% at $504.45
Silver up $1.6 or +3.31% at $49.9061
Platinum up $31.34 or +2.03% at $1577.26

Time: 10:05 GMT

Date	GMT/Local	Impact	Country	Event
10/11/2025	-	***	CN	Money Supply
10/11/2025	-	***	CN	New Loans
10/11/2025	-	***	CN	Social Financing
10/11/2025	1630/1130	*	US	US Treasury Auction Result for 26 Week Bill
10/11/2025	1630/1130	*	US	US Treasury Auction Result for 13 Week Bill
10/11/2025	1700/1200	***	US	USDA Crop Estimates - WASDE
10/11/2025	1800/1300	***	US	US Note 03 Year Treasury Auction Result
11/11/2025	2350/0850		JP	Balance of Payments
11/11/2025	0001/0001	*	GB	BRC-KPMG Shop Sales Monitor
11/11/2025	0500/1400		JP	Economy Watcher's Survey
11/11/2025	0700/0700	***	GB	Labour Market - AWE & Unemployment
11/11/2025	0700/0700	***	GB	Labour Market - Payrolls & Claimants
11/11/2025	0820/0920		EU	ECB Lagarde Video Message at Bank of Albania
11/11/2025	0830/0930		SE	Riksbank Minutes
11/11/2025	0830/0830		GB	BOE Greene in Panel at UBS European Conference
11/11/2025	1000/1100	***	DE	ZEW Current Expectations Index
11/11/2025	1100/0600	**	US	NFIB Small Business Optimism Index
11/11/2025	1200/0700	**	BR	Brazil Final CPI
11/11/2025	1355/0855	**	US	Redbook Retail Sales Index