Asia-Pacific Market Update: Dollar Weakens Ahead of US CPI Data

Key points:

• China's September exports climbed roughly 36% year-on-year in US dollar terms, well above the 25.5% forecast, while imports 31%, also surpassing expectations.
• China's producer prices rose 5% annually, the quickest since June 2022, and consumer inflation ticked up to 0.9%, missing forecasts.
• Singapore central bank kept its policy steady, a move that caught all 10 analysts surveyed by surprise as they had anticipated tightening.
• ECB President Lagarde said there are no second-round inflation effects yet but the ECB cannot wait until they become fully visible; the euro strengthened.
• The greenback edged lower, with the Australian and New Zealand dollars leading gains; USD/JPY retreated from earlier peaks above 158.40.
• Oil prices remained steady, with Brent near $106 a barrel, while gold moved within a narrow range of around $4,150 to $4,170.
• Japan's Nikkei advanced 0.6%, and South Korea's Kospi climbed roughly 2%.
• September US consumer price data is scheduled for release at 1230 GMT.

Oil and gold commodities:

Crude oil prices stayed steady during Asian trading following a busy news-filled Tuesday, with no major new developments and Brent crude trading near $106 per barrel.

Speaking at a rally in Alaska, President Donald Trump stated that Taiwan has consented to purchase 30% of the gas from Alaska LNG pipeline project and invest approximately $4.4 billion, adding to South Korea's $50 billion commitment. He repeated his predictions that oil will soon and Iran war will conclude very shortly, forecasts he made repeatedly during his war.

Gold moved mostly sideways between roughly $4,155 $4,165.

China trade data

In September, China's exports increased by roughly 36% year-on-year in US dollar terms, significantly exceeding the 25.5% forecast and accelerating from 25% in August. Imports rose 31%, beating the 24.5% estimate and climbing from approximately 28% the previous month.

Producer prices climbed 5% annually, surpassing 4.5% prediction and recording quickest since June 2022 due to oil and commodity. Consumer inflation inched up 0.9%, lower than 1%, while core inflation remains at 1%, indicating tepid domestic that curbs transmission of costs to consumers.

Monetary policy decisions

Singapore's Monetary Authority left its settings unchanged, preserving the slope, mid-point, and width the Singapore dollar nominal effective exchange rate S$NEER band. This outcome took by surprise, as had tightening move. The MAS indicated inflation risks are leaning to

European Central Bank President Christine Lagarde that inflation been largely, but not exclusively, by energy notes that second-round effects not yet emerged, but cannot wait until become fully visible, and it wage expectations collective Regarding she stated solution primarily depends on French fiscal

FX markets

US dollar edged lower against most major currencies. The Aussie led gains following better-than-expected trade figures, and the Kiwi also the euro strengthened in response to Lagarde's comments, which traders interpreted as stance. USD/JPY from earlier 158.40

Equity markets

Japan's Nikkei 225 gained 0.6%, recovering from previous steep drop, boosted gains semiconductor South Korea's climbed 2%, also rebound

Crypto market

Strategy executive chairman Michael Saylor that reached just below $60,000 and is expected rise back above $100,000, arguing investors shift into scarce assets as artificial intelligence erodes value labor-intensive He did not specific timeframe

Upcoming: CPI release report

September US consumer price data is scheduled at release 0830 A Wall Street Journal shows median of approximately 0.6% headline CPI, pushing the annual to 3.6% from 3.4%, driven by surging gasoline Core is expected decelerate to 0.22% month from 0.29%, year-on-year steady Core vary from 0.16% by Deutsche Bank 0.24% Goldman Sachs, and Stanley Fed officials debate inflation is beyond core likely day. The Fed's Beige Book follows