October 30 saw the first face to face meeting between President Trump and China President Xi on the sidelines of the APEC summit. The result appears to indicate a significant de-escalation in tension but appears to be short on substance with critical outstanding issues remaining unresolved. There were no details on US curbs on semiconductors and equipment sales to China, agreement on rare earth and critical mineral exports as well as China’s commitment to agricultural purchases. The only positive is President Trump saying he will visit China in April next year followed by President Xi’s trip to the US.
President Trump has terminated all trade negotiations with Canada over an advertisement by the province of Ontario which featured a recording of former President Ronald Reagan speaking negatively about tariffs.
The FOMC meeting over 28 / 29 Oct resulted in the Fed Funds Target Rate (FFTR) lowered by 0.25% to a range of 3.75% - 4.00%, as expected in a non-unanimous decision (10-2). Fed Chairman Powell cautioned that “further reduction in the policy rate at the December meeting is not a forgone conclusion, far from it”. A policy divide within the Central Bank and a lack of federal Government data is a stumbling block. On the positive side, Powell signalled the Fed may stop Quantitative Tightening (started in 2022) to allow more liquidity into the economy hopefully stimulating it in the face of rising unemployment.
Powell’s cautionary statement on further interest rate reductions may mute risk sentiment as we move into the final last two months of the year. On the flip side during his post FOMC press conference last Wednesday he dismissed the current tech led stock rally to comparisons of the dotcom era bust of the late 1990s.
The Conference Board has indicated that US Consumer Confidence eased in October as households worried about jobs and persistently higher prices because of tariffs on imports. The estimated CPI is up 3.0% YoY, its highest point since Trump returned to the White House. On 29 Oct the ADP National Employment Report's estimate showed US private payrolls increased by an average of only 14,250 jobs in the four weeks ending 11 October.
As at today 4 Nov, the current US government shutdown has lasted 34 days, tying the previous record set during the 2018–2019 shutdown. If it continues past today, it will officially become the longest shutdown in US history.
In a communique released on Thursday 23 Oct after a four-day conclave of the Communist
Party’s Central Committee, China said it aims to “greatly increase” its capacity for self-reliance and strength in science and technology in the next five years. Ominously, it will also seek to maintain manufacturing’s share in the economy at a “reasonable” level as part of efforts to build a modern industrial system.
Bitcoin is up about 18.6% YTD and holders are moving their wealth from blockchain to Wall Street. The crypto rich are moving their fortunes to a new generation of exchange traded funds (ETFs) without selling, through funds run by big asset managers like BlackRock. A Trump administration regulatory change this July opened the door for large investors to hand their Bitcoin to an ETF in exchange for shares of the fund. It’s called an in-kind transaction.
Oil prices have recovered from near a six-month low of USD55.97 on 20 Oct but remain muted. The International Energy Agency in Paris predicts that world supplies could exceed demand in Q4 by more three million barrels a day and then balloon to an unprecedented glut next year. WTI is currently trading around USD60.80 (7 Oct USD61.50).
Overnight US 10-Year Treasuries closed unchanged at 4.11% (7 Oct 4.16%), Australian 10-Year Govt Bonds were up 0.02% at 4.36% (7 Oct 4.39%) and Euro 10-Year Bonds closed up 0.03% at 2.67% (7 Oct 2.72%).
Over the last few months long term interest rates have remain relatively steady indicating economies are also stabilising in the face of ongoing geopolitical concerns and President Trump’s tariff wars.
Sources: Bloomberg, MSNBC, Reuters, Morningstar, Business Times, 04 Nov 2025
AUDUSD
At its MPC meeting today, the Reserve Bank of Australia (RBA) kept the OCR unchanged at 3.6%. RBA is also likely to hold the cash rate at 3.60% at its next meeting on 9 Dec. The recent signing of an agreement for Australian production of rare earths by President Trump and PM Albanese, plus the de-escalation of US / China trade tensions provided scant support for AUDUSD. This is likely due to a resurgent USD and underlying structural AUD weakness.
AUDUSD’s repeated challenges of the 61.8% Fibonacci Resistance Zone at 0.6460 – 0.6600 over the last six months have failed. We continue to maintain a view for the next move to be down to around the 0.6400 area.
Image Source: Bloomberg 04 Nov 2025
EURUSD
EURUSD continues to be under pressure due to weak economic fundamentals and geopolitical concerns. Adding further pressure, at its October meeting ECB kept interest rates unchanged at 2% for the third time in a row and offered no hints about future moves.
Over the last five months, EURUSD has not been able to break above strong Resistance at 1.1820. EURUSD has moved to the 1.1500 area and may find some support here in the next few weeks. However, we maintain a view for a correction lower to around 1.1150 Support.
Image Source: Bloomberg 04 Nov 2025
GBPUSD
The market expects the BoE to leave the Bank Rate on hold at 4% when it meets this Thursday 6 Nov with UK inflation running at almost double its 2% target. Another reason for holding this is Chancellor Rachel Reeves will deliver her budget on 26 Nov. With UK finances in bad shape another round of expected hefty tax increases could act as a further dampener to an already subdued economy. GBPUSD might come under further pressure.
GBPUSD’s upside is over as it has broken below the 1.3200 – 1.3400 Support Zone. Our view for a push down to the 1.3200 area has been exceeded. We can expect GBPUSD to test lower to 1.3000 over the next few weeks.
Image Source: Bloomberg 04 Nov 2025
USDJPY
The BoJ kept interest rates steady at 0.5% at its October meeting, “policymakers at Japan’s Central Bank disappointed JPY bulls by staying on hold and exhibiting the same degree of dissent as in September”. The interest rate outlook remains cloudy, and this has put pressure on the JPY.
USDJPY might move higher towards the 155.00 area in the broad Uptrend Channel. In the following weeks USDJPY might test Channel top around 157.00
Image Source: Bloomberg 04 Nov 2025
USDSGD
Amid resilient economic growth the Monetary Authority of Singapore (MAS) kept its monetary policy settings unchanged at its MPC meeting on Tuesday 14 October. It will likely maintain its current policy settings of a slight positive S$NEER band appreciation (est 0.5% p.a.) for the rest of
2025 and into 2026. Growth remained resilient despite challenges from US tariffs. Q3 GDP coming in at 2.9% YoY was stronger than expected (consensus of 1.9%).
The SGD is expected to remain steady to firmer against the USD. Inflation has been on downtrend over the last 2 years.
Against our expectation of range trading, USDSGD is moving higher. It may head to 1.3100 over the next few weeks but we can expect a fall back towards the 1.3000 area heading into the year end.
Image Source: Bloomberg 04 Nov 2025
AUDSGD
In October AUDSGD dropped sharply but found support around 0.8400 and managed a bounce. The area above Resistance Zone at 0.8400 – 0.8500 is still a tough barrier. We maintain a bearish view for a drop back to 0.8400 and lower.
Image Source: Bloomberg 04 Nov 2025
XAUUSD
In our October analysis we indicated that “XAUUSD is very much higher than its 50-Days Moving Average around USD3,550, this indicates a very overbought market. We can therefore expect a correction in Gold in the coming weeks.” XAUUSD has retreated to nearer the 50-Days Moving Average to Support around USD4,000.
Intense buying this year saw a remarkable rally pushing Gold to new all time highs and a YTD gain of almost 67% at the highest point. On 21 Oct Gold suffered its largest single day price decline in over a decade, of almost 7%. This sharp correction was necessary to trim down the excessive speculative long positioning.
Further pressure came from China’s Ministry of Finance announcing that from 1 Nov retailers can no longer offset Value Added Tax (VAT) when selling Gold purchased from the Shanghai Gold Exchange. This should increase Gold prices for consumers in one of the World’s largest Gold market.
We are likely to see a pull back from Support around USD4,000 after which the chart is indicating a steeper down move to the 50-Days Moving Average area around USD3,800.
Image Source: Bloomberg 04 Nov 2025