MNI US OPEN - Trump, Xi Strike "12 out of 10" Agreement

EXECUTIVE SUMMARY:

• TRUMP, XI STRIKE AGREEMENT INC. REMOVAL OF FENTANYL TARIFFS, "LARGE SCALE" BUYS OF US ENERGY, AGRICULTURAL PRODUCTS
• BOJ UNCHANGED, PROVIDES SCANT GUIDANCE ON NEXT HIKE
• STATE-LEVEL INFLATION DATA POINTS TO UPSIDE RISK TO GERMAN INFLATION
• ECB RATES EXP UNCHANGED, WITH POLICY IN "GOOD PLACE"
• FOOD AID AT RISK AS LAWMAKERS LEAVE FOR LONG WEEKEND

Figure 1: ECB Policy Expected Unchanged as inflation in "good place"

NEWS:

US-CHINA (MNI): China Lays Out Details Of U.S. Agreement - Mofcom
The U.S. has agreed to remove a 10% fentanyl tariff imposed on Chinese goods, while its 24% reciprocal tariff will continue to be suspended for one year, a spokesperson for China’s Ministry of Commerce said on Thursday, answering a reporter's question on the joint arrangement reached between China and the U.S. during the Kuala Lumpur economic and trade consultations this week.

US-CHINA (BBG): Trump Says China to Purchase More US Energy, Touts Alaska Deal
US President Donald Trump said China would purchase more US energy as part of a wider trade truce, and hinted at an unspecified “very large scale” transaction involving Alaskan oil and gas. Writing on Truth Social after talks with Chinese counterpart Xi Jinping on Thursday, Trump said officials from both nations’ energy teams, including US Energy Secretary Chris Wright and Interior Secretary Doug Burgum, would be meeting to work out the specifics of a deal. He provided no further detail.

US-CHINA (BBG): Trump Says Nvidia Chip Talks With Xi Didn’t Cover Blackwell
US President Donald Trump said he didn’t discuss approving sales of Nvidia Corp.’s Blackwell chips to China with his counterpart Xi Jinping, dampening speculation that Washington will allow exports of the powerful AI accelerators to the world’s largest semiconductor market.

US (BBG): Food Aid for Millions at Risk as Senators Leave for Long Weekend
Senators failed this week to resolve a standoff over funding food aid during the government shutdown and plan to head home Thursday for a long weekend, leaving millions of low-income Americans struggling to purchase groceries starting Saturday. 

US-RUSSIA (BBG): Trump Orders Nuclear Weapons Trials After Russia Tests
President Donald Trump said the US would match its rivals in testing nuclear weapons after Russia in recent days announced trials of a nuclear-powered underwater drone and nuclear-capable cruise missile.

NETHERLANDS (BBG): Dutch Voters Turn to Centrists as Far-Right Support Falls
The centrist Democrats 66 party looked set to play a key role in forming a new Dutch government as its support nearly tripled in Wednesday’s parliamentary election. The D66, a pro-European group focused on the country’s housing crisis, was set to win 26 seats in the 150-seat House of Representatives, according to a preliminary forecast published by Dutch newswire ANP after 98% of votes were counted.

AUSTRALIA (BBG): Ex-RBA Chief Lowe Urges Policy Pause to Assess High Labor Costs
Former Australian central bank Governor Philip Lowe said a clouded outlook for the nation’s high unit labor costs suggests the best course for the Reserve Bank is to “sit still.”

DATA:

EUROPEAN INFLATION: Spain upside and Germany upside risk: Implications not clear

• Spain this morning saw HICP surprise 0.2ppt to the upside - partly due to electricity prices and partly air fares and other transport fares.
• The German state data also now looks for upside risks (full tracking on that to follow later). At this stage it's unclear how much of that may also be influenced by air fares (the electricity prices seem to be idiosyncratic to Spain though).

EUROPEAN INFLATION: German state CPI pointing initially to upside risks

• Initial state CPI data is coming in broadly in line or slightly higher than the national consensus. M/Ms are at 0.2-0.4%M/M and Y/Y are at 2.2-2.6%Y/Y from those we have seen so far.
• The national CPI and HICP prints will come at 13:00BST. Consensus looks for 0.2%M/M and 2.2%Y/Y for both.
• Surprises in state CPI data don't always correlate fully with HICP surprises. We will release our full tracking estimate later this morning.

MNI: FRANCE Q3 FLASH GDP +0.5% Q/Q, +0.9% Y/Y (VS +0.3% Q/Q,
MNI: GERMANY Q3 FLASH GDP SA +0.0% Q/Q, WDA +0.3% Y/Y

FOREX: USDJPY Surges Through Key Resistance to Fresh 8-Month Highs

• USDJPY (+0.62%) has broken through key resistance Thursday, rallying to fresh 8-month highs of 153.89. Bank of Japan Governor Ueda did not provide a signal around the likely timing of the next rate hike, which combined with the hawkish Fed has underpinned the constructive USDJPY price action. Ueda noted that still-elevated trade policy uncertainty justified holding rates in October, while the BOJ wants to get an early read of next year's wage momentum before delivering another hike.
• The move strengthens bullish trend conditions in USDJPY, with focus now on 154.39, a Fibonacci retracement point. While press conference commentary on recent exchange rate moves was rather in line with previous rhetoric, further upward pressure in USDJPY could raise concern amongst BoJ officials - whose commentary subsequently remains key to watch for the pair.
• Elsewhere, markets view the outcome of the overnight Trump-Xi meeting rather favourably, with the key rare earths conflict appearing to be resolved for the time being. This may have underpinned some NZD outperformance on the margin, with NZDUSD standing at 0.5773, but feedthrough to wider G10 FX appears limited for now.
• Eurozone Q3 GDP is scheduled for release soon, ahead of German national-level CPI later today. Attention then turns to the ECB, firmly expected to hold its key interest rates, putting focus on Lagarde's press conference. EURUSD has recovered from the post fed lows of 1.1578, consolidating around the 1.1625 mark. Price needs to trade above 1.1728, the Oct 17 high, to reinstate a bull theme.

BONDS: UST Beta Driving Gilts This Morning, Little Reaction In Bunds To EZ Data

As expected, Gilts have been driven by fiscal headlines and UST spillovers this week. The hawkish reaction in US FI to yesterday’s Fed press conference has pushed 10-year Gilt yields up 4bps to 4.43%. 10-year Bund yields meanwhile are up 2.3bps to 2.64%, generally looking through this morning’s heavy data calendar. That leaves the 10-year Gilt/Bund spread 1.7bps wider at 178.7bps. A reminder that the spread registered a fresh year-to-date closing low yesterday.

• Bund futures are down 26 ticks at 129.31, while Gilts are down 31 ticks at 93.47. Both contracts are off session lows.
• In the Eurozone, focus remains on this afternoon’s ECB decision (1315GMT) and press conference (1345GMT). We expect President Lagarde to adopt a broadly neutral tone to maintain optionality.
• This morning’s data hasn’t generated much reaction in EGBs. Spanish and German state-level flash inflation prints have surprised to the upside, Meanwhile, French flash Q3 GDP was stronger-than-expected, Germany was broadly in line, while Italy surprised to the downside. On net, risks to the Eurozone-wide consensus of 0.1% Q/Q (due at 1000GMT today) appear balanced.
• Italy is holding a 5/10-year BTP / CCTeu auction this morning, with E9.5bln of bonds on offer in total (including E7.5bln of nominal BTPs).
• 10-year EGB spreads to Bunds are biased up to 1bp wider.

COMMODITIES: Gold Cycle Low Means Correction May Not Be Over

A fresh cycle low this week in Gold highlights an extension of the bear cycle that started Oct 20. Note that the trend is overbought and the deeper retracement is allowing this condition to unwind. The 20-day EMA has been breached, signalling scope for a deeper retracement, towards the 50-day EMA, at $3846.3. Key resistance and the bull trigger has been defined at $4381.5, the Oct 20 high. Initial resistance is at $4161.4, the Oct 22 high. Recent gains in WTI futures appear corrective for now, however, note that price has recently traded through the 50-day EMA, currently at $60.09. The breach of this average signals scope for a stronger recovery. A resistance at $62.34, the Oct 8 high, has also been pierced. A clear break of it would expose key resistance at $65.77, the Sep 26 high. Key support and the bear trigger has been defined at $55.96, the Low Oct 20.    

• WTI Crude down $0.31 or -0.51% at $60.17
• Natural Gas up $0.04 or +0.92% at $3.849
• Gold spot up $62.06 or +1.58% at $3989.89
• Copper down $5.7 or -1.08% at $520.8
• Silver up $0.59 or +1.25% at $48.1423
• Platinum up $18.83 or +1.18% at $1613.04

EQUITIES: Trend Condition in Stocks Remains Bullish

The trend condition in S&P E-Minis remains bullish and price is trading higher this week. 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. The trend structure in Eurostoxx 50 futures remains bullish. This week’s fresh cycle high’s reinforces a bull theme and the move higher maintains the rising price sequence of higher highs and higher lows. Note too that moving average studies are in a bull-mode position, highlighting a dominant medium-term uptrend. Sights are on 5777.41, a Fibonacci projection. First support lies at 6740.59, the 20-day EMA.   

• Japan's NIKKEI closed higher by 17.96 pts or +0.04% at 51325.61 and the TOPIX ended 22.55 pts higher or +0.69% at 3300.79.
• Elsewhere, in China the SHANGHAI closed lower by 29.43 pts or -0.73% at 3986.901 and the HANG SENG ended 63.45 pts lower or -0.24% at 26282.69.
• Across Europe, Germany's DAX trades higher by 75.23 pts or +0.31% at 24198.67, FTSE 100 lower by 44.59 pts or -0.46% at 9711.59, CAC 40 down 3.26 pts or -0.04% at 8197.95 and Euro Stoxx 50 up 5.73 pts or +0.1% at 5711.67.
• Dow Jones mini down 103 pts or -0.22% at 47695, S&P 500 mini down 1 pts or -0.01% at 6921.5, NASDAQ mini up 6.75 pts or +0.03% at 26267.5.

Date	GMT/Local	Impact	Country	Event
30/10/2025	1000/1100	*	EU	Consumer Confidence, Industrial Sentiment
30/10/2025	1000/1100	**	EU	EZ Unemployment
30/10/2025	1000/1100	***	EU	EZ GDP 1st (Prelim Flash)
30/10/2025	1230/0830	***	US	Jobless Claims
30/10/2025	1230/0830	**	US	WASDE Weekly Import/Export
30/10/2025	1230/0830	*	CA	Payroll employment
30/10/2025	1230/0830	***	US	GDP / PCE Quarterly
30/10/2025	1230/0830	***	US	GDP / PCE Quarterly
30/10/2025	1300/1400	***	DE	Germany CPI (p)
30/10/2025	1300/1400	***	DE	Germany CPI (p)
30/10/2025	1315/1415	***	EU	ECB Deposit Rate
30/10/2025	1315/1415	***	EU	ECB Main Refi Rate
30/10/2025	1315/1415	***	EU	ECB Marginal Lending Rate
30/10/2025	1345/1445		EU	ECB Press Conference
30/10/2025	1355/0955		US	Fed's Michelle Bowman
30/10/2025	1430/1030	**	US	Natural Gas Stocks
30/10/2025	1515/1615		EU	ECB Lagarde Presents Rate Decision on ECB Podcast
30/10/2025	1530/1130	**	US	US Bill 04 Week Treasury Auction Result
30/10/2025	1530/1130	*	US	US Bill 08 Week Treasury Auction Result
31/10/2025	2330/0830	**	JP	Tokyo CPI
31/10/2025	2330/0830	*	JP	Labor Force Survey
31/10/2025	2350/0850	*	JP	Retail Sales (p)
31/10/2025	2350/0850	**	JP	Industrial Production
31/10/2025	0030/1130	*	AU	Producer price index q/q
31/10/2025	0130/0930	***	CN	CFLP Manufacturing PMI
31/10/2025	0130/0930	**	CN	CFLP Non-Manufacturing PMI
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