He says, Xi Says
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What does the Trump‑Xi deal mean for tariffs and rare‑earth trade?
Well, Donald Trump and President Xi have done a deal of sorts, a kind of he says she says moment, and the deal is kick the can down the road. But rare earth minerals will not be held back for now. China will buy soybeans. It's staved off the hundred percent tariff hike and actually seen tariffs come down a little bit. Meanwhile, ECB kept race on hold, so did the Bosch and Big Tech Earnings, probably the major factor. Focus right now. It's Friday, it's the thirty-first of October 2025. Halloween. It's the morning call from Nab. Good morning. Well the US dollar climbed a little further since yesterday's Fed meeting, up another third of one percent on the DXY, getting closer to one hundred actually, although a chunk of that is going to be the fall in the yen since the Bosch meeting.
Uh the Aussie is down a quarter percent to sixty-five point six US cents. Equities in the US uh haven't taken the prospect of uh slow moves down in rates at all well, although the Nasdaq is down one percent, but a chunk of that actually is the uh earnings that we saw yesterday. Today from the big tech players uh Meta missed on their EPS expectations and shares down more than ten percent today. Microsoft were beat on earnings, but even so their shares are down three percent this morning. But Alphabet did better than expected and they're up four percent or more. Uh and more earnings coming today. Not much movement in Treasury yields, but yields in Europe up two or three basis points after uh the E C B meeting overnight.
Aussie ten years over at four point three one percent hanging on to that big lift in yields that we saw yesterday. So Gavin Friend is here today from NAB in London. You might have expected a bit more enthusiasm in the markets today. After all, we had the Trump G meeting. It was an excellent meeting we are told. Truly great according to President Trump. But really um it's just delaying things, isn't it? It's basically a one year truce. Yeah more
Why aren’t markets reacting enthusiastically to the ‘truly great’ meeting?
I think that's right. I mean markets really Thursday are reflecting on the combination of that uh Trump She meeting. They're reflecting on um the earnings from the tech, BMOS, Alphabet, Meta, and uh Microsoft. And they're reflecting certainly on what we learned from the Fed uh even twenty four hours ago. So I think, you know, as you say, on the day, yields uh have nudged up a little bit further. They've extended a little bit, a couple of basis points from where, you know, the quite big moves that we saw uh yesterday. Uh I think the dollar, again to your point, is the standout mover, another point four, point five percent on that. I would certainly agree that um, you know, a chunk of that is is down to um
A move up in dollar yen, uh again, you know, reacting to what they what they heard at the Fed, or what they think they heard at the Fed, which is a Fed that's sounding a little less dovish, shall we say, than uh they were uh before the meeting. You know, I would remind, you know, that we've still got the the uh the the the December meeting priced at what seventeen nearly eighteen. basis points from you know from uh you know almost fully priced. It's it's it's it's a move, but it's not it's not a huge move. the market is still leaning into that. We'll see how that plays out. It would only take something softer on, you know, the labor market side, uh or something else there to uh to shift that a little bit or a comment from, you know, someone like Bowman, um uh
But hard, isn't it? Hard set without the data. That's the problem. Well it it is. And you know, we that's why we get these, you know, the market gets into a direction, we think we know where we're going, and then we get uh an about face and that obviously inf you know impacts positioning. But back to the you know what we were saying about dollar yen, you know, overnight we had the Bank of Japan, seven two, same as the September meeting, no surprises there. But the market really didn't hear anything that was convincing to suggest that the Bank of Japan um is ready to hike rates again. Um, you know, the uh Governor Wade has said the BOJ wants to see more domestic data on wages, uh and wage setting behaviour before, you know, he moves.
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Chapters
8 chapters
1
What does the Trump‑Xi deal mean for tariffs and rare‑earth trade?
0:01–1:55
2
Why aren’t markets reacting enthusiastically to the ‘truly great’ meeting?
1:55–4:21
3
How are big‑tech earnings (Meta, Microsoft, Alphabet) influencing market sentiment?
4:21–6:20
4
What is the impact of the dollar‑yen move and the Fed’s tone on global rates?
6:20–9:19
5
How are ECB rate‑hold decisions and European CPI data shaping the eurozone outlook?
9:19–11:03
6
What do Germany’s and Spain’s CPI surprises mean for future ECB policy?
11:03–12:50
7
How are China’s PMI figures and commodity flows affecting global growth forecasts?
12:50–15:23
8
What upcoming data (Japan CPI, Canada GDP, ANZ consumer confidence) should investors watch?
15:23–16:59