The euro rose to $1.165, moving further away from a two-month low of $1.154 on Tuesday, after France’s government survived a no-confidence vote. Prime Minister Sebastien Lecornu’s pledge to suspend a landmark pension reform secured support from some left-wing lawmakers. Meanwhile, US dollar came under pressure after Fed Chair Jerome Powell highlighted labor market weakness, and Wednesday’s Fed Beige Book confirmed further slowing in the US economy, reinforcing expectations of another rate cut this month. This dovish outlook contrasts with ECB projections, which suggest interest rates are likely to remain unchanged. Meanwhile, US-China trade tensions escalated following China’s expansion of rare earth export controls last week, criticized by senior US officials, though Presidents Trump and Xi Jinping are still expected to meet in South Korea later this month.

Euro Strengthens as France Survives Confidence Vote

The British pound remained above $1.34 after UK GDP data came in line with forecasts, providing some relief to Finance Minister Rachel Reeves ahead of the government’s November 26 budget. The UK economy grew 0.1% in August, rebounding from a 0.1% contraction in July, led by manufacturing, while services were flat for a second month and construction fell. However, an annual expansion of 1.3% is insufficient to offset the need for tax increases. Reeves recently signaled she is considering tax hikes and spending cuts, with the government likely needing to raise around £30 billion amid rising borrowing costs, scrapped welfare cuts, and weaker growth forecasts. On the monetary policy front, traders have increased bets on Bank of England rate cuts next year, even as the IMF cautioned that inflation is expected to remain the highest in the G7 through 2026, advising the BoE to proceed carefully.

Pound Holds Above $1.34 as UK GDP Data Meets Expectations

The New Zealand dollar rose for a second consecutive day to around $0.574 on Thursday, benefiting from broad weakness in the US dollar. The greenback came under pressure amid prospects of Federal Reserve rate cuts, alongside intensifying US-China trade tensions and the ongoing federal government shutdown, which have heightened concerns about the US economic outlook. However, the kiwi’s upside remained limited by a dovish monetary policy outlook at home. Reserve Bank of New Zealand Chief Economist Paul Conway reiterated on Wednesday that the central bank remains open to further policy easing, though it will wait for economic data before making a decision. Markets are currently pricing in another rate cut in November, with rates expected to fall to 2.0% by 2026. Supporting this view, the latest data showed that New Zealand’s annual food inflation eased to a five-month low of 4.1% in September from 5.0% in August.

New Zealand Dollar Gains on Softer US Dollar

The South Korean won strengthened to around 1,417 per dollar on Thursday, extending gains for the second straight session as the dollar weakened on renewed strain in US–China trade relations. Domestically, investor sentiment improved amid signs of progress in high-stakes trade negotiations between Seoul and Washington. Both nations are reported to have moved closer to alignment over implementing South Korea’s $350 billion investment pledge under a trade framework settled on in July. President Donald Trump said Wednesday that Seoul had agreed to make an “upfront payment” of the pledged sum to invest in the US. His remarks came shortly after Treasury Secretary Scott Bessent suggested the two nations were close to resolving key disagreements. Both governments plan to finalize the deal by late October, potentially at the APEC summit in Seoul, where Trump and President Lee are expected to meet.

Won Climbs on Weaker Dollar, US–Korea Trade Momentum

The yen strengthened past 151 per dollar on Thursday, rising for the third straight session as the path for Liberal Democratic Party leader Sanae Takaichi to become the next prime minister remains highly uncertain following the coalition breakup with the Komeito party last week. The ruling party proposed holding a leadership vote on Oct. 21, though opposition parties have not yet agreed to the date. Traders who previously shorted the yen on expectations that Takaichi would pursue aggressive fiscal spending and continued monetary accommodation have since reversed those positions amid growing political uncertainty. Meanwhile, Bank of Japan board member Naoki Tamura cautioned against tightening policy too soon, stressing the need to avoid a return to stagnant prices and wages. Additional support came from safe-haven inflows and a weaker dollar amid escalating US-China trade tensions, the prolonged US government shutdown and dovish signals from the Federal Reserve.

Yen Strengthens on ‘Takaichi Trade’ Unwind

The dollar index fell below 98.5 on Thursday, sliding for the third straight session as escalating US-China trade tensions, the prolonged government shutdown, and expectations of further Federal Reserve rate cuts weighed on the greenback. When asked whether the US would remain in a trade war with China if President Trump and President Xi fail to reach an agreement during their upcoming meeting in South Korea, Trump replied, “We’re in one now.” Still, Treasury Secretary Bessent hinted at the possibility of extending the current trade truce beyond three months if Beijing suspends plans for new export controls on rare earth minerals. Meanwhile, the government shutdown entered its third week, delaying key economic data releases that could inform policy decisions. Fed Chair Powell highlighted signs of labor market weakness in a Tuesday speech, reinforcing market bets on a rate cut this month, another in December, and as many as three more next year.

Dollar Extends Slide for Third Session

The Australian dollar weakened below $0.650 on Thursday, reversing the previous session’s gains, after a softer jobs report revived expectations of an RBA rate cut. The Australian Bureau of Statistics reported that the unemployment rate rose more than expected to 4.5%, the highest in nearly four years, while employment increased by just 14,900, below forecasts for a 20,000 gain. The data signaled further labor market loosening, ramping up bets that the Reserve Bank may resume rate cuts as early as next month. Investors now price in a 71% chance of easing, up from 40% before the release. Attention now turns to third-quarter inflation data due in less than two weeks, which will be key to shaping expectations for the November policy meeting. Governor Michele Bullock earlier noted that stronger consumer spending and higher readings in some parts of inflation had prompted policymakers to reconsider the need for additional rate cuts.

Australian Dollar Slips on Softer Jobs Data

The Indian Rupee touched 87.75 against the USD, the highest since September 2025. Over the past 4 weeks, US Dollar Indian Rupee lost 0.11%, and in the last 12 months, it increased 4.48%.

Indian Rupee Hits 4-week High

The Canadian dollar weakened past 1.4 per US dollar in mid-October to six-month lows, pressured by softer crude prices, slowing domestic data, and expectations of lower Bank of Canada policy rates. Oil, Canada’s largest export, has dropped to five-month lows amid persistent US-China trade tensions, rising supply, and anticipated US inventory builds, raising fears of oversupply and weaker demand and removing a key support for the currency. At the same time, broad economic indicators point to cooling domestic momentum, with GDP growth slowing, core inflation near the lower end of the BoC’s target, and modest wage gains, reducing the case for higher borrowing costs. Recent BoC communications reinforce the likelihood of a rate cut or pause, further diminishing expected returns from holding Canadian assets relative to the US.

Canadian Dollar Weakens to 6-Month Low

The dollar index remained below 99 on Wednesday, as investors assessed recent trade developments and comments from Federal Chair Powell that reinforced expectations of continued interest rate cuts. Treasury Secretary Scott Bessent proposed a longer pause on high US tariffs on Chinese goods in exchange for Beijing delaying its planned restrictions on rare earth exports, offering some relief to investors after recent tensions. The move followed a renewed escalation, with President Trump ultimately threatening a cooking oil embargo in response to China’s soybean boycott. On the monetary policy front, Chair Powell on Tuesday warned of rising risks to employment, strengthening market bets on further easing. The odds of another 25-basis-point Fed rate cut this month currently stand at about 97%. Meanwhile, the euro advanced after France proposed suspending major pension reforms, while the yen strengthened as traders unwound the “Takaichi trade”.

Dollar Remains Subdued

The Brazilian real weakened toward 5.5 per US dollar, rebounding from two-month lows near R$5.52 on October 10th as a weaker dollar outweighed renewed trade frictions and lingering fiscal uncertainty. Fed Chair Jerome Powell’s view that the US labour market is softening and the prospect of imminent rate cuts reduced dollar support, a dynamic amplified by the US government shutdown that has delayed key data and left markets more reliant on Fed guidance. However, US-China measures, including reciprocal port fees and China’s sanctions on US-linked Hanwha units, raised shipping and receipts risk and increased exporters’ hedging demand. Domestically, Congress’s shelving of a key investment-tax measure keeps the prospect of higher issuance and funding strain on the table, while slightly stronger-than-expected August public-finance figures and tighter spending controls have offered only a modest offset.

Brazilian Real Rebounds on USD Weakness

The euro bounced back above $1.16, recovering from a more than two-month low of $1.154 hit on Tuesday, as investors welcomed signs of political stabilization in France and assessed rising expectations of US interest rate cuts. French Prime Minister Lecornu told parliament he supports suspending pension reforms until the 2027 presidential election, aiming to secure Socialist backing and survive crucial no-confidence votes on Thursday. In the US, Fed Chair Powell highlighted ongoing deterioration in the labor market, reinforcing expectations of another rate cut this month. This dovish outlook contrasts with ECB projections, which suggest interest rates are likely to remain unchanged. Meanwhile, US–China trade tensions intensified as President Trump signaled Washington might end certain trade ties with China. Both nations imposed extra port fees on each other’s shipping firms, following Trump’s threat of 100% tariffs on Chinese goods and Beijing’s tighter controls on rare earth exports.

Euro Rebounds on French Political Stability and US Rate-Cut Hopes

The Indian rupee strengthened to around 88.3 per USD, hitting its highest level in nearly a month, after the Reserve Bank of India took aggressive steps to counter heavy selling pressure. Having defended the currency above its record low of 88.80 for the past two weeks, the central bank appeared to shift toward actively targeting bearish wagers. Early dollar sales by state-run banks prompted traders to reduce short positions, fueling a swift rebound in the currency. The intervention eased pressure the rupee had been facing in recent weeks, including steep US tariffs, tighter immigration rules, foreign outflows, and surging precious metal prices like gold, a key vulnerability given India’s heavy reliance on gold imports. Elsewhere, ongoing softness in the US dollar added further support, following Fed Chair Jerome Powell's remarks that reinforced expectations of additional US monetary easing.

Indian Rupee Rebounds Amid RBI Intervention

The New Zealand dollar edged up to $0.572 on Wednesday but remained near a six-month low, as investors digested Reserve Bank of New Zealand Chief Economist Paul Conway’s remarks. Conway said that the RBNZ remains open to further rate cuts if necessary, although policymakers want to wait for more data before making a decision. However, he noted that the central bank does not expect to use additional monetary policy tools again anytime soon, adding that it is unrealistic to expect monetary or fiscal policies to offset every economic shock. Still, markets are pricing in around an 85% probability that the RBNZ will cut rates by 25bps at its November meeting, with some expecting rates to fall to 2.0%. Moreover, rising tensions between the US and China injected fresh uncertainty into global markets and dampened risk appetite, which tends to pressure the trade-exposed Antipodean currency.

New Zealand Dollar Hovers Near 6-Month Low

The Indian rupee stayed weak around 88.7 per USD, trading close to its all-time low, as renewed US-China trade tensions dampened global risk appetite. This further compounded the pressures the rupee faces from steep US tariffs, tighter immigration rules, foreign outflows, and surging precious metal prices like gold, a key vulnerability given India’s heavy reliance on gold imports. Still, the currency’s decline was limited by frequent central bank intervention, with state-run banks seen selling dollars around the 88.8 level to cap losses. Additional support came from reports of Indian officials visiting the US for trade talks, though traders see little chance of a sustained rebound without tangible progress. On the data front, September’s inflation eased to 1.54%, below market estimates of 1.7% and the RBI’s 2–6% target, fueling bets of rate cuts. This follows the central bank’s dovish remarks on potential future rate cuts during its September meeting, where it kept rates unchanged.

Indian Rupee Stays Near All-Time Low

The offshore yuan rose to around 7.12 per dollar on Wednesday, snapping a three-session decline, as the People’s Bank of China reaffirmed its commitment to maintaining currency stability. The central bank continued setting the daily yuan reference rate at levels notably stronger than market expectations, aiming to mitigate the broader economic and geopolitical repercussions of escalating US-China trade tensions. On the economic front, the latest inflation data pointed to continued weakness, reflected in persistent deflationary pressures. Consumer prices fell more than expected in September, though the decline moderated slightly from August. Meanwhile, producer prices remained in deflation for a third consecutive month in August, albeit at a slower pace than in July. Externally, the yuan found additional support from a weakening US dollar after Fed Chair Jerome Powell signaled openness to a potential interest rate cut at the late-October policy meeting.

Offshore Yuan Snaps 3-Session Decline

The South Korean won appreciated to around 1,426 per dollar on Wednesday, rebounding from the previous session’s losses as the dollar weakened amid heightened expectations of further monetary easing. Federal Reserve Chair Jerome Powell stated on Tuesday that the outlook for employment and inflation has remained largely unchanged since September, when the Fed implemented its first policy rate reduction of the year. On the domestic front, the won also gained support from the International Monetary Fund’s revised 2025 growth outlook for the country. The IMF on Tuesday raised its forecast to 0.9 percent, up 0.1 percentage point from July, noting that the impact of US tariff measures has been smaller than expected.

South Korean Won Rises on Fed Rate Cut Bets

The Japanese yen strengthened toward 151 per dollar on Wednesday, rising for the second straight session as markets remain uncertain whether ruling Liberal Democratic Party leader Sanae Takaichi will become the next prime minister following the coalition split with the Komeito party. Takaichi, who is known for supporting Abenomics-style expansionist policies, spurred bets on increased fiscal spending and loose monetary policy, typically weighing on the yen while boosting equities. Opposition parties are also holding talks today to secure enough backing to form a new government. Meanwhile, the yen drew additional support from safe-haven demand amid escalating US-China tensions, after President Trump threatened Beijing with a cooking oil embargo in response to China’s soybean boycott.

Yen Gains as Markets Reverse Takaichi Trade

The Australian dollar appreciated to around $0.650 on Wednesday, recovering some of the prior session’s losses, as investors weighed comments from an RBA official pointing to a likely hotter-than-expected inflation. Assistant Governor Sarah Hunter noted that recent economic data has been slightly stronger than anticipated, indicating inflation in the third quarter may exceed earlier forecasts. Her remarks echoed Tuesday’s RBA minutes, which showed policymakers saw no urgency to cut rates amid persistent services inflation and steady employment. Markets now assign roughly even odds of a rate cut at the November 4 meeting and about a 60% chance in December, down from 70% previously. Traders will also closely watch upcoming labor figures later this week. Meanwhile, latest data showed Australia’s Westpac-Melbourne leading economic index was unchanged in September, signaling moderating momentum but steady trend growth heading into early 2026.

Aussie Dollar Gains as RBA Flags Hotter Inflation

The dollar index slipped below 99 on Wednesday, falling for the second straight session after Federal Reserve Chair Jerome Powell’s remarks highlighting a weakening labor market reinforced expectations for further interest rate cuts. The ongoing federal government shutdown which has prevented the release of crucial economic data also clouded the economic outlook, pressuring the currency further. Currently, markets are nearly fully priced in for another quarter-point rate cut this month, with an additional reduction seen in December, followed by three more next year. The dollar also came under pressure from escalating US-China trade tensions after President Donald Trump threatened China with a cooking oil embargo in retaliation for Beijing’s soybean boycott. Meanwhile, the euro advanced after France proposed suspending major pension reforms, while the yen strengthened as traders unwound the “Takaichi trade.”

Dollar Extends Fall on Dovish Powell Remarks

The dollar index fell toward 99 on Tuesday as investors digested remarks from Federal Reserve Chair Jerome Powell highlighting a weakening labor market, which reinforced expectations for an imminent rate cut. The ongoing federal government shutdown has limited the release of key economic data, keeping near-term growth signals unclear and increasing focus on policy developments. Meanwhile, markets continued to track US–China trade tensions ahead of a potential Trump-Xi meeting, with China recently sanctioning US-linked units of South Korea’s Hanwha Ocean, adding uncertainty to the outlook for global commerce.

DXY Slides After Fed Chair Powell Speech

The Brazilian real weakened toward 5.5 per US dollar, nearing the early August low of 5.52 seen October 10th after a fresh repricing of trade risk raised immediate dollar demand. Reciprocal port fees and Chinese sanctions on US-linked units of South Korea’s Hanwha increased shipping frictions and the probability of sustained trade disruption, prompting importers, exporters and carriers to boost dollar hedges and cash buffers. Even strong Chinese commodity purchases, such as record September iron ore imports, do not eliminate the risk that seaborne flows will be delayed or rerouted, which reduces expected dollar receipts for exporters. Those external forces are compounded by domestic fiscal uncertainty after Congress shelved a tax overhaul that had been expected to improve the public finances, raising anticipated issuance and lowering foreign appetite for local currency assets.

Brazilian Real Retreats Toward August Lows

The South African rand edged down to around 17.5 per USD, as the dollar held firm and key precious metals, notably gold, palladium, and platinum, lost ground. Meanwhile, traders weighed recent domestic data and global developments on trade and politics. South Africa's mining output unexpectedly declined in August, marking the first contraction since April. On the trade front, South Africa’s trade minister Parks Tau said South Africa was on the verge of a new trade deal to reduce the 30% tariffs imposed in early August on its exports to the United States.  Officials also said that the AGOA agreement remains in effect despite its September 30 expiry, with US lawmakers planning a short-term extension while discussions continue on a revised trade framework for sub-Saharan markets.

South African Rand Weakens

The euro slipped toward $1.15, hitting its weakest level since July 31, as investors closely watched political developments in France. Reappointed Prime Minister Sébastien Lecornu is rushing to present the 2026 budget bill to parliament before constitutional limits on reviewing the legislation expire. The plan, according to the Haut Conseil des Finances Publiques, aims to reduce the Eurozone’s largest deficit to between 4.7% and 5% of GDP, a modest improvement from this year’s 5.4%. Meanwhile, concerns over a potential US-China trade war resurfaced after both countries imposed additional port fees on ocean shipping firms. This follows President Trump’s threat of 100% tariffs on Chinese goods and Beijing’s decision to tighten rare earth export controls. On the data front, German investor sentiment improved in October, but less than expected, adding to cautious market sentiment.

Euro Weakens to 2-1/2-Month Low Amid French Budget Concerns

The dollar index hovered around 99.3 on Tuesday, showing little direction as investors awaited remarks from Federal Reserve Chair Jerome Powell later in the session. His speech comes amid a prolonged US government shutdown that has limited the release of key economic data, prompting markets to look toward upcoming bank earnings for signals on the economy’s health. The Fed is widely expected to deliver another quarter-point rate cut this month following a similar move in September, with another reduction anticipated in December. Meanwhile, investors continued to track fast-evolving US-China trade developments ahead of a potential Trump-Xi meeting in South Korea later this month. In the latest escalation, China imposed restrictions on five US units of Hanwha Ocean in response to Washington’s probes into Chinese maritime, logistics, and shipbuilding sectors.

Dollar Steadies Ahead of Powell Speech

The Japanese yen appreciated past 152 per dollar on Tuesday, recouping losses from the previous session as shifting US-China trade dynamics ahead of a potential Trump-Xi meeting in South Korea later this month lifted demand for the safe-haven currency. Investors also continued to monitor Japan’s domestic political situation after the Komeito party announced its exit from the ruling coalition led by the Liberal Democratic Party, heightening doubts over Sanae Takaichi’s policy agenda and complicating her path to the premiership. Meanwhile, Finance Minister Katsunobu Kato said Japan’s current environment differs from the Abenomics era of aggressive stimulus, noting that inflation, rather than deflation, is now the primary concern. He also cautioned against one-sided and rapid currency moves, stressing that exchange rates should remain stable and aligned with economic fundamentals.

Yen Strengthens on Safe-Haven Demand

The British pound fell below $1.33, hovering at its weakest level since August 1, after data suggesting weaker wage growth raised expectations that the Bank of England could continue cutting interest rates, albeit gradually. The latest UK jobs report showed regular pay growth eased to 4.7% in June–August 2025, down slightly from 4.8% in the previous three months and marking the weakest pace since March–May 2022. Other key indicators suggest the UK labor market is stabilizing: the unemployment rate rose slightly to 4.8%, above forecasts of 4.7%, while declines in payroll numbers and vacancies appear to be leveling off.

Pound Hits Lowest Level Since August as Wage Growth Slows

The New Zealand dollar depreciated below $0.57 on Tuesday, extending its bearish run to a fresh six-month low, battered by expectations of further policy stimulus compounded with trade risks. Reports showed that China imposed sanctions on five US-affiliated subsidiaries of South Korean shipbuilder Hanwha Ocean, dimming hopes of easing tensions between the two powers and raising fears of fallout for export-reliant markets. Domestically, New Zealand’s electronic card spending declined in September, suggesting consumers remain unresponsive to recent rate cuts. This supported the central bank’s decision last week to implement an oversized 50 bps rate cut, reflecting growing concern over the country’s weakening economic momentum. Officials also signaled that additional monetary support could follow. Markets are now pricing in another cut in November, with projections that rates could fall to 2% by 2026. Investors are turning their attention to next week’s Q3 inflation data.

NZ Dollar Falls to Fresh Six-Month Low

The Australian dollar depreciated past $0.651 on Tuesday, hitting its lowest level in over a month as renewed tensions between the US and China weighed on market sentiment. China imposed sanctions on five US-affiliated subsidiaries of South Korean shipbuilder Hanwha Ocean, escalating trade frictions between the world’s two largest economies. The move coincided with the implementation of reciprocal port fees by both nations, although China exempted vessels constructed domestically. On the monetary policy front, minutes from the Reserve Bank of Australia's October meeting revealed that the board saw no immediate need for further interest rate adjustments. Nonetheless, the RBA emphasized a cautious, data-dependent approach to any future policy moves. Meanwhile, Australia's NAB Business Confidence Index rose to 7 in September 2025, picking up from a three-month low of 4 in the previous month and remaining above its long-term average.

Aussie Dollar Hits Over 1-Month Low

The offshore yuan edged lower to around 7.14 per dollar on Tuesday, trading within a narrow range, as investors monitored signs of easing US-China trade tensions. US Treasury Secretary Scott Bessent said Monday that President Trump remains on course to meet Chinese President Xi Jinping in South Korea later this month as both nations seek to defuse tensions over tariffs and export controls. Meanwhile, China’s commerce ministry defended its rare earth export measures, noting the US had been given advance notice and stressing that the restrictions are aimed at safeguarding national security and stabilizing global supply chains, not imposing a ban. The PBOC also continued to support the yuan through stronger midpoint guidance, cushioning the impact of trade tensions. Looking ahead, investors will closely watch China’s upcoming inflation report, expected to show a modest year-on-year contraction and a slight monthly gain.

Offshore Yuan Rangebound

The Japanese yen fell to around 152.3 per dollar on Tuesday, extending losses from the previous session as mounting political uncertainty dampened investor sentiment. On Friday, Japan’s Komeito party announced its withdrawal from the ruling coalition led by the Liberal Democratic Party, deepening doubts over Sanae Takaichi’s policy agenda and complicating her path to the premiership. Meanwhile, Finance Minister Katsunobu Kato said Japan’s current situation differs from the Abenomics era of expansionary policy, noting that inflation, rather than deflation, is now the main concern. He also warned against one-sided and rapid currency movements, emphasizing that exchange rates should reflect economic fundamentals. Externally, the yen faced additional pressure from a stronger dollar amid easing US-China trade tensions, with Presidents Donald Trump and Xi Jinping expected to meet later this month.

Yen Weakens Amid Political Uncertainty

The Australian dollar stabilized around $0.651 on Tuesday, as minutes from the Reserve Bank of Australia's October meeting indicated that the central bank saw no urgency for additional rate cuts. The RBA held its cash rate at 3.6% in September 2025, following a 25bps cut in the previous month, keeping borrowing costs at its lowest since April 2023. The central bank noted that monetary policy remains somewhat restrictive, but the full effects of earlier easing are still filtering through the economy, as seen in rising housing prices and credit growth. However, the minutes also highlighted ongoing economic risks, with household consumption remaining weak amid subdued job and wage growth. Nevertheless, the board reiterated that future policy decisions will remain cautious and firmly guided by incoming data. On the economic front, Australia's NAB Business Confidence Index rose to 7 in September 2025, up from a three-month low of 4 in August, remaining above its long-term average.

Aussie Dollar Steady as RBA Signals No Urgency to Cut Rates

The New Zealand dollar traded around $0.572 on Tuesday, holding its bearish slump near a six-month low, weighed down by expectations of further easing by the Reserve Bank. Policymakers surprised markets last week with an oversized 50 bps rate cut, reflecting growing concern over the country’s weakening economic momentum. Officials also hinted that additional monetary support could follow. Recent subdued PMI data reinforced this dovish stance, with markets now betting on another cut in November and projecting rates could fall to 2% by 2026. Investors are now turning their attention to next week’s Q3 inflation data. Meanwhile, the Kiwi faced additional pressure from a firmer US dollar, as markets monitored signs of easing US-China trade tensions after both sides signaled readiness to resume talks ahead of a possible meeting between Presidents Trump and Xi.

Kiwi Dollar Mired at Six-Month Lows

The South Korean won hovered near 1,427 per dollar on Tuesday, showing little change from the previous session as markets cautiously evaluated recent signals from Seoul and Washington amid ongoing trade negotiations. After weeks of limited progress, the presidential office said the United States has formally responded to South Korea’s revised proposals on the $350 billion investment package tied to a planned tariff reduction on Korean goods from 25 percent to 15 percent. The United States presented what it described as a “new alternative” proposal, suggesting technical discussions are continuing, though substantive progress remains uncertain. Meanwhile, Seoul is maintaining its push for financial safeguards, including a possible bilateral foreign exchange swap arrangement, as it seeks to ensure stability and favorable terms in managing the potential impact of large capital flows.

Won Steadies Amid Ongoing US–Korea Talks

The dollar index hovered above 99.2 on Tuesday after advancing in the previous session, supported by easing US-China trade tensions as both sides expressed willingness to resume negotiations ahead of a possible meeting between President Donald Trump and Chinese President Xi Jinping later this month. On Friday, Trump had threatened steep tariff hikes on Chinese goods in response to Beijing’s new export controls on rare earth minerals but later struck a more conciliatory tone, saying trade relations “will all be fine.” Meanwhile, the ongoing US government shutdown has limited the flow of economic data, leaving investors to look toward upcoming earnings reports from major banks for clues on the economy’s health. The greenback held firm against most major peers and extended gains versus the yen amid heightened political uncertainty in Japan.

Dollar Holds Firm as Trade Tensions Ease

The Indian rupee edged up to around 88.6 per USD, after hitting an all-time low of 88.9 per USD on October 9, supported by likely RBI intervention and fresh foreign inflows. The currency was further supported by reports that senior Indian officials will visit the US this week for trade talks, with negotiations on the bilateral agreement reportedly progressing well. On the data front, September’s inflation eased to 1.54%, below market estimates of 1.7% and the RBI’s 2–6% target, fueling expectations of rate cuts.This follows the central bank’s dovish remarks on potential future rate cuts during its September meeting. The Reserve Bank of India kept rates on hold and maintained a neutral policy stance, noting that muted inflation provides flexibility to support the economy.

Indian Rupee Recovers from Record Lows

The South African rand appreciated more than 1% to around 17.3 per USD, approaching its highest level since September 2024, buoyed by record prices of critical metal prices, such as gold, palladium and platinum. Meanwhile, traders welcomed developments in the Middle East, while also factoring in global risks, including US-China renewed trade frictions and the US shutdown. On the domestic front, South Africa’s trade minister Parks Tau has indicated that the country is close to finalizing a trade agreement with the US that could ease damaging tariffs and protect thousands of jobs.

South African Rand Firms

The Brazilian real strengthened past 5.48 per US dollar, rebounding from an early August low of 5.52 seen October 10th, after a sharp repricing of trade-war risk following US signals that a weekend escalation with China was being dialled back. President Trump’s softer tone and follow-up comments lowered the odds of abrupt tariffs or export controls, which reduced emergency dollar-hedging flows. That external relief came as China’s September buying, notably record iron-ore imports and firmer crude/soy purchases, lifted Brazil’s near-term export receipts, increasing foreign-currency inflows. Domestically, the Selic rate at 15% keeps real yields attractive, sustaining portfolio demand for reais and limiting sustained outflows. Still, the currency remains vulnerable after the rejection of the IOF-replacement measure and ongoing worries about a widening fiscal deficit have kept funding premia elevated and leave the real exposed to renewed risk or budget-related shocks.

Brazilian Real Rebounds

The Indian rupee traded around 88.7 per USD, close to historic lows, after September’s inflation eased to 1.54%, below market estimates of 1.7% and the RBI’s 2–6% target, fueling expectations of rate cuts. This follows the central bank’s dovish remarks on potential future rate cuts during its September meeting. The Reserve Bank of India kept rates on hold and maintained a neutral policy stance, noting that muted inflation provides flexibility to support the economy. The currency has traded in a narrow range between 88.7 and 88.9 since September 23, prompting some traders to speculate that the RBI is intervening heavily to keep the rupee anchored. Key factors behind the currency's weakness included prolonged equity outflows, steep US tariffs linked to Russian oil measures, trade uncertainties and a tightening visa regime.

Indian Rupee Hovers Around Record Lows

The British pound slipped to $1.333, weighed down by a stronger US dollar and investor caution ahead of the UK’s November budget. Markets are concerned that potential tax hikes aimed at meeting fiscal goals could further strain the fragile UK economy. Finance Minister Rachel Reeves is expected to emphasize fiscal discipline in her November 26 budget, possibly through higher taxes, following her earlier £25 billion increase in employer social contributions. Analysts foresee modest growth for the rest of 2025, with inflation projected to reach 4%, twice the Bank of England’s target. Investors are closely watching upcoming UK data on employment, wages, and GDP to gauge the outlook for interest rates. The BoE meets next on November 6, with markets expecting no rate change and the first cut no earlier than March. Persistent inflation in wages and services remains a challenge. Meanwhile, the dollar strengthened after President Trump softened his tariff stance toward Beijing.

Sterling Weakens Slightly

The Swiss franc weakened slightly toward 0.80 per USD, pressured by some easing in geopolitical tensions in the Middle East following the Gaza ceasefire agreement, despite persistent concerns in Eastern Europe. Meanwhile, safe-haven demand remained supported by renewed trade uncertainty, a prolonged US government shutdown, and expectations of US rate cuts. Trade tensions between the US and China flared on October 10 after President Trump threatened a 100% tariff on Chinese goods and export controls on “critical” software, before signaling a more conciliatory stance two days later. Domestically, the Swiss National Bank is expected to keep interest rates on hold for the foreseeable future. A Bloomberg survey showed that economists have largely abandoned forecasts of a return to negative rates, with SNB President Martin Schlegel emphasizing that reintroducing subzero policy would be difficult given its impact on the financial system.

Swiss Franc Eases

The euro hovered around $1.16, near its more than two-month low of $1.154 reached last Thursday, as investors weighed political uncertainty in France and ongoing US-China trade tensions. In France, Sebastien Lecornu— the country’s fifth prime minister in two years—resigned last Monday, only to be reappointed on Friday. He is set to present a draft budget bill today, facing a narrow path to political survival as he seeks to push it through parliament. Lecornu aims to persuade both the Socialists and the center-right Republicans to abstain or offer conditional support in a budget vote. Encouragingly, a majority of deputies oppose dissolving parliament, suggesting a viable path to adopting the budget may exist. Meanwhile, in the US, President Trump struck a more conciliatory tone toward China on Sunday, just two days after threatening 100% tariffs on Chinese imports in response to Beijing’s move to tighten export controls on rare earths.

Euro Steady Near Two-Month Low as France Faces Political Strain

The South Korean won steadied to around 1,427 per dollar on Monday, halting last week’s decline as improved regional risk outlook supported the currency. Signs of a moderating tone in US–China trade relations contributed to improved market sentiment, easing concerns over a potential escalation in tariff measures. Adding to the upbeat mood, government officials reaffirmed efforts to strengthen bilateral economic cooperation with the United States. Industry Minister Kim Jung-kwan noted that Seoul is in continued discussions with Washington to finalize the framework for Korea’s investment package in the US.

South Korean Won Halts Decline

The New Zealand dollar rose to around $0.574 on Monday, attempting to rebound from a six-month low after President Trump hinted that he may not follow through with his massive tariff threat against China. Still, markets remained cautious, closely monitoring developments and the potential economic fallout between the world’s two largest economies. Meanwhile, the Kiwi came under sharp downward pressure last week after the Reserve Bank unexpectedly delivered a larger rate cut, lowering its benchmark interest rate by 50 basis points to 2.50%, the lowest in more than two years. Policymakers cited mounting concerns about the economy’s fragile outlook and signaled that further easing remains possible. Reinforcing this view, the latest PMI showed that the services sector has been contracting for over a year and a half. Investors now see a strong chance of another rate reduction at the central bank’s November meeting, with some expecting rates to fall to 2.0% next year.

New Zealand Dollar Attempts to Rebound

The offshore yuan edged higher to around 7.14 per dollar on Monday, recovering some of its prior losses, as investors weighed US President Trump’s tempered remarks that softened Friday’s tariff announcements on Chinese goods. In a follow-up post and comments to reporters, Trump said trade relations with China “will all be fine,” hinting at openness to talks and a potential meeting with President Xi. His remarks partially eased concerns triggered by his earlier pledge to impose 100% tariffs and software restrictions starting November 1. China, however, struck a defiant tone, saying it was “not afraid” of a trade war and accusing the US of a “double standard” after Washington’s latest measures. Analysts suggested Beijing’s recent policy signals may reflect an effort to strengthen its negotiating stance ahead of further discussions. Meanwhile, markets await upcoming domestic trade balance data due today, expected to narrow in September, with exports projected to rise faster than imports.

Offshore Yuan Edges Higher

The Japanese yen weakened toward 152 per dollar in thin holiday trading on Monday, reversing some of the previous session’s gains as easing US-China trade tensions dampened safe-haven demand and investors monitored political developments in Tokyo. The yen had jumped more than 1% on Friday after US President Donald Trump threatened to impose an additional 100% tariff on Chinese goods starting November 1 in response to Beijing’s new export controls on rare earth minerals. However, Trump later signaled openness to negotiate ahead of a potential meeting with President Xi Jinping later this month, saying that trade relations with China “will all be fine.” In Japan, markets reassessed the odds that LDP leader Sanae Takaichi will become prime minister and roll out fresh fiscal stimulus after Komeito quit the ruling coalition on Friday, ending a partnership of more than 25 years over what it called Takaichi’s failure to “provide sufficient answers regarding political funding issues.”

Yen Slips as US-China Tensions Ease

The Australian dollar rose toward $0.653 on Monday, rebounding from significant losses in the previous week, as investor sentiment improved following reassuring comments from President Donald Trump amid rising tensions in the US-China trade dispute. In a Truth Social post, he said trade ties with China “will all be fine,” signaling openness to talks and a possible meeting with President Xi. His comments eased concerns following his move to impose 100% tariffs and software restrictions starting November 1. Domestically, investors are closely watching for the release of the RBA meeting minutes, upcoming speeches by central bank officials, and key labor market data expected in the coming days. This followed recent remarks from Governor Michele Bullock, who emphasized ongoing concerns about persistent inflation and reaffirmed a data-dependent approach to monetary policy. Markets are now pricing in only about a 52% chance of a 25 bps rate cut at the RBA’s November meeting.

Australian Dollar Rebounds

The dollar index steadied around 99 on Monday after sliding sharply in the previous session, as President Donald Trump walked back his threat to impose massive tariffs on China, saying in a Truth Social post that trade relations with the country “will all be fine.” Vice President JD Vance echoed that view, noting the US is ready to negotiate if Beijing is “willing to be reasonable.” The index had fallen about 0.5% on Friday after Trump warned of a 100% tariff on Chinese goods starting November 1 in response to Beijing’s new export controls on rare earths and related technologies, reminding investors that trade tensions remain elevated. The dollar also firmed against the yen as markets reassessed the odds of LDP leader Sanae Takaichi becoming Japan’s next prime minister after Komeito exited the ruling coalition on Friday, while holding losses versus the euro after France unveiled a new cabinet line-up on Sunday.

Dollar Stabilizes as US-China Trade Tensions Ease

The Zambia Kwacha touched 22.56 against the USD, the highest since February 2024. Over the past 4 weeks, Zambia Kwacha lost 4.82%, and in the last 12 months, it decreased 14.41%.

Zambia Kwacha Hits 19-month High

The Brazilian real weakened sharply to 5.48 per US dollar, marking its lowest level since August 20, as global markets were gripped by risk-off sentiment amid contagion concerns. The selloff was driven by mounting concerns over Brazil’s widening fiscal deficit and skepticism about the government’s ability to rein in spending. Market sentiment worsened after the rejection of an alternative to the dismissed IOF tax hike proposal, which would have changed taxation on financial investments and digital assets. Adding to fiscal uncertainty, President Lula unveiled a new housing finance plan aimed at expanding mortgage access ahead of the 2026 election, a move critics say could strain the budget. With investors seeking safety in the US dollar, Brazil’s central bank is likely keeping a close watch, but the real remains vulnerable to both domestic fiscal pressures and global market volatility.

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