October 16th, New York Update: Global Markets and Geopolitical Briefing

Show Notes — Thu, Oct 16, 2025


FX

• USD mixed/softer as Fed signals rising job-market risks and a nearing end to balance-sheet runoff; data flow still disrupted by shutdown.
• EUR holds above 1.16 on improved French political backdrop and firmer industrial prints.
• GBP firmer above 1.34; Chancellor Reeves flags higher taxes on wealthier households; BoE notes softer labour market.
• JPY briefly bid after BoJ’s Tamura urged moving rates toward neutral; haven tone faded as USD flows stabilized.
• AUD pressured by weaker jobs (higher unemployment), partly offset by RBA comments that conditions have eased; NZD steadier alongside a stronger PBoC CNY fix.

Commodities

• Gold extends record run above $4,200/oz on softer USD and easing expectations.
• Oil rangebound; geopolitical noise (Ukraine strike on Russian refinery; reports of Indian refiners preparing to trim Russian imports) offset by surprise U.S. builds in crude and gasoline and cautious demand guidance.
• Base metals subdued to rangebound; China CPI/PPI still soft keeps demand questions open.

Tariffs & Trade

• President Trump: U.S. is “in a trade war with China”; tariffs framed as national-security tool; 100% tariffs remain on the table.
• China MOFCOM: rare-earth curbs are not a ban; civilian-use licenses to be approved; earlier introduced special port fees for U.S. ships.
• South Korea signals optimism on a U.S. tariff accommodation alongside a large U.S. investment pledge.
• Mexico in talks with U.S. to discount tariffs on heavy-truck parts.
• U.S. officials say no broad evidence of appliance tariff evasion after Whirlpool complaint.

Geopolitics

• Middle East: Fragile Gaza ceasefire; Israel orders plans in case fighting resumes; Hamas says all recoverable hostages/remains transferred; U.S. describes improving aid flows and early work on a stabilization force.
• Russia–Ukraine: Kyiv signals desire to press offensive; talk of potential settlement space persists; energy infrastructure again targeted.
• Venezuela: Caracas condemns Trump’s confirmation of CIA operations, calling it a violation of international law.

Notable Policy/Headline Signals

• Fed Beige Book: activity little changed; labour demand muted; retail goods spending edged down.
• BoJ’s Tamura: push rates toward neutral to avoid sharper hikes later.
• U.K. budget signalling: higher taxes on the wealthy “part of the story.”

What to Watch Next

• USD path as Fed speakers (Waller, Barkin, Barr, Miran, Bowman, Kashkari) frame the easing outlook.
• Follow-through in gold at new highs and whether oil breaks its range on fresh supply/demand shocks.
• Any concrete U.S.–China tariff steps (scope, timelines, sector carve-outs) and China’s licensing cadence on rare earths.
• U.K. budget details and French no-confidence dynamics for EUR sentiment.