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The Consumer Price Index (CPI) rose 0.3% month-on-month (m/m) in September, a tick below the consensus forecast in Bloomberg. On a twelve-month basis, CPI rose to 3.0% (from 2.9% the month prior).

• Higher prices at the pump (+4.1% m/m) were partly responsible for the sustained strength in headline inflation, while food prices (+0.2% m/m) moderated thanks to a slowing in grocery costs and 'food away from home'.

Excluding food and energy, core inflation rose 0.2% m/m, a step down from the 0.3% m/m readings in the two prior months and a tick below the consensus forecast. The twelve-month change was up 3.0%, while the three-month annualized rose by a slightly faster 3.6%.

Services inflation moderated in September – rising 0.20% m/m – following a hotter 0.35% m/m gain the month prior. The deceleration was largely led by a cooling in primary shelter costs (+0.15% m/m vs 0.4% m/m in August), which grew at their slowest monthly rate since January 2021. Price growth for non-housing services (+0.3% m/m vs. +0.4% m/m in August) also eased but are still running just under 5% annualized over the last three months.

• Higher travel costs (+1.8% m/m) remain a notable contributor to the sustained strength in non-housing services, thanks to a further uptick in airfares (+2.7% m/m) and hotel costs (+1.8% m/m). Price growth for recreational services (+0.4% m/m) also accelerated on the month.

Tariff passthrough continued to materialize in core goods prices, which were up 0.2% m/m and would have been even larger if not for the pullback in used vehicle prices (-0.4% m/m) and educational goods (-0.8% m/m). Price gains were most notable in apparel (+0.7% m/m), appliances (+0.5% m/m), and recreational commodities (+0.4% m/m).

With the shutdown ongoing, this morning's CPI release was done so that the government could meet its statutory requirements in adjusting Social Security payments for next year, which are benchmarked to Q3 CPI data.

• Because the Bureau of Labor Statistics conducted the September CPI survey ahead of the government shutdown, there are no concerns with data quality.
• However, collection rates could very well be impacted for the October survey, given that data gathering is still suspended with the shutdown ongoing. At a minimum, this suggests there could be issues with data quality in the next release, and the longer the shutdown drags on, the greater the risk that the October report is skipped entirely.

Key Implications

September's inflation report came in a bit softer than expected, thanks to a sharp cooling in primary shelter costs. Elsewhere, there were plenty of signs to suggest that elevated inflationary pressures are likely to persist in months ahead. Tariff passthrough continued to mount, with 75% of goods categories experiencing price gains last month (up from 67% in August). Meanwhile, price growth for non-housing services remained firm, particularly in categories tied to discretionary consumer spending.

With the softening labor market becoming a more pointed concern for policymakers, we don't feel that today's elevated inflationary pressures will deter the FOMC from delivering on another quarter-point rate cut next week. However, hotter readings on subsequent inflation prints could have implications for future decisions, particularly given the growing divide among FOMC members. For now, markets are still priced for another 50 basis points of easing by year-end – a view that aligns to our forecast.

Daily Pivots: (S1) 1.1595; (P) 1.1608; (R1) 1.1630; More…

Outlook in EUR/USD remains unchanged and intraday bias stays neutral. Further decline is expected with 1.1727 resistance intact. Break of 1.1540 will resume the fall from 1.1917 to 1.1390 support, or even further to 38.2% retracement of 1.0176 to 1.1917 at 1.1252. On the upside, though, break of 1.1727 resistance will turn bias back to the upside for 1.1778, and then retest of 1.1917 high instead.

In the bigger picture, considering bearish divergence condition in D MACD, a medium term top is likely in place at 1.1917, just ahead of 1.2 key psychological level. As long as 55 W EMA (now at 1.1290) holds, the up trend from 0.9534 (2022 low) is still expected to continue. Decisive break of 1.2000 will carry larger bullish implications. However, sustained trading below 55 W EMA will argue that rise from 0.9534 has completed as a three wave corrective bounce, and keep outlook bearish.

Daily Pivots: (S1) 1.3301; (P) 1.3333; (R1) 1.3358; More...

Intraday bias in GBP/USD remains neutral for the moment and outlook is unchanged. Fall from 1.3725 could extend lower and break of 1.3247 will target 1.3140 cluster (38.2% retracement of 1.2099 to 1.3787 at 1.3142). Strong support is expected there to contain downside to complete the corrective pattern from 1.3787. On the upside, break of 1.3170 resistance will turn bias back to the upside for 1.3526 resistance. Firm break there will target 1.3725/87 resistance zone.

In the bigger picture, rise from 1.0351 (2022 low) is still seen as a corrective move. Further rally could be seen to 61.8% projection of 1.0351 to 1.3433 (2024 high) from 1.2099 (2025 low) at 1.4004. But strong resistance could emerge from 1.4248 (2021 high) to limit upside. Sustained break of 55 W EMA (now at 1.3191) will argue that a medium term top has already formed and bring deeper fall back to 1.2099.

Daily Pivots: (S1) 0.7939; (P) 0.7963; (R1) 0.7976; More…

Intraday bias in USD/CHF remains neutral for the moment. With 0.7984 resistance intact, further decline is in favor. On the downside, below 0.7913 minor support will turn bias to the downside for 0.7872 and then 0.7828 low. Firm break there will resume larger down trend. However, break of 0.7984 will suggest that corrective pattern from 0.7828 is extending with another rising leg, and target 0.8075 again.

In the bigger picture, long term down trend from 1.0342 (2017 high) is still in progress. Next target is 100% projection of 1.0146 (2022 high) to 0.8332 from 0.9200 at 0.7382. In any case, outlook will stay bearish as long as 0.8332 support turned resistance holds (2023 low).

Daily Pivots: (S1) 152.01; (P) 152.40; (R1) 152.99; More...

Intraday bias in USD/JPY is turned neutral with current retreat, and some consolidations would be seen. Another rise is in favor as long as 55 4H EMA (now at 151.56) holds. Above 153.05 will target 153.26, and then 100% projection of 142.66 to 150.90 from 145.47 at 153.71. Firm break there would prompt upside acceleration to 161.8% projection at 158.80.

In the bigger picture, current development suggests that corrective pattern from 161.94 (2024 high) has completed with three waves at 139.87. Larger up trend from 102.58 (2021 low) could be ready to resume through 161.94 high. On the downside, break of 145.47 support will dampen this bullish view and extend the corrective pattern with another falling leg.

Dollar eased in early U.S. session after the latest inflation report came in slightly softer than expected, reinforcing expectations of continued monetary easing by the Fed. The pullback was modest, but sentiment turned more dovish as traders focused on the dip in core inflation, which may be seen as evidence that price pressures have peaked during the summer. While still early to call a full victory on inflation, the data injected a sense of guarded optimism into markets.

Rate expectations shifted quickly, with futures markets now nearly fully pricing a December rate cut following next week’s anticipated 25bps reduction. Fed funds futures indicate a 99% probability that policy rates will be lowered to the 3.50–3.75% range by year-end.

Elsewhere, U.S. stock futures rose modestly after the release, buoyed by expectations of a friendlier rate environment. DOW edged closer to its record highs, though whether buying momentum can sustain through the session remains to be seen. Meanwhile, Treasury yields tumbled, with the 10-year yield falling back sharply after briefly testing 4.0%, signaling that the market may have just given its final “kiss goodbye” to that level for now.

In commodities, Gold staged a modest recovery, continuing to defend the 4,000 mark despite muted momentum. The metal remains supported by lower yields and lingering geopolitical concerns, though traders appear hesitant to extend the rally until the Dollar’s next clear directional move.

Across the currency markets, commodity-linked currencies continue to lead weekly performance — Kiwi remains the strongest, followed by Aussie and Loonie. Yen stays under broad pressure, trailed by Sterling and Euro. Dollar and Swiss Franc are holding mid-pack, though momentum suggests Dollar could slide further before the weekly close if risk appetite persists.

In Europe, at the time of writing, FTSE is up 0.12%. DAX is up 0.21%. CAC is down -0.34%. UK 10-year yield is down -0.02 at 4.415. Germany 10-year yield is up 0.03 at 2.619. Earlier in Asia, Nikkei rose 1.35%. Hong Kong HSI rose 0.74%. China Shanghai SSE rose 0.71%. Singapore Strait Times rose 0.13%. Japan 10-year JGB yield fell -0.002 to 1.659.

US CPI rises to 3.0%, but Core eases, both miss expectations

US inflation ticked higher in September, but the details of the report suggested price pressures are cooling beneath the surface. Headline CPI accelerated to 3.0% yoy, up from 2.9% but slightly below expectations of 3.1%. That marks the highest level since January.

Though, core CPI — excluding food and energy — slowed from 3.1% to 3.0%, undershooting forecasts and easing from 3.1% in the previous two months. After holding at 3.1% for two consecutive months, the core rate could be entering into a gradual downtrend.

On a monthly basis, headline prices rose 0.3% mom, while core prices increased just 0.2%, both softer than expected. Energy costs were again the key driver of the headline gain, with the gasoline index surging 4.1% and the broader energy index up 1.5%. Food prices also continued to edge higher, rising 0.2% as grocery costs climbed more sharply than dining-out prices.

UK PMI composite improves to 51.1, but indicates just sluggish 0.1% GDP growth

The latest UK flash PMI data offered a glimmer of optimism for the economy, with Manufacturing jumping from 46.2 to 49.6 in October — its highest level in 12 months. Services rose from 50.8 to 51.1, lifting the Composite index from 50.1 to 51.1. The survey suggests business conditions are slowly improving after a soft September, marking the first sign of renewed momentum since midyear.

Chris Williamson, Chief Business Economist at S&P Global Market Intelligence, said the data “brings hope that September was a low point,” noting the first manufacturing growth in over a year and stronger consumer demand for services. He added that inflationary pressures are easing back toward levels “consistent with the Bank of England’s 2% target,” while job losses are moderating and business confidence is ticking up slightly.

Still, the overall pace of expansion remains modest, consistent with GDP growth of only about 0.1%. Export weakness persists due to global trade disruptions tied to U.S. tariff policy. Firms are also cautious ahead of the November 26 Budget, with many delaying hiring and investment decisions. While the PMI data point to stabilization, the recovery remains fragile and heavily dependent on fiscal clarity and external demand.

UK retail sales rise 0.5% mom in September, hitting highest level mid-2022

UK retail activity surprised to the upside in September, with sales volumes rising 0.5% mom, defying expectations of a -0.2% mom decline. The gain marked the fourth consecutive monthly increase, lifting total sales to their highest level since July 2022. Stronger non-store and clothing sales helped offset weakness in fuel and other discretionary categories.

Over the third quarter, retail volumes grew 0.9% compared with the previous quarter, confirming a steady rebound in household demand through the summer. The good weather in July and August was cited as a key driver, boosting clothing sales and supporting outdoor-related spending. Online and non-store retailers also enjoyed sustained gains.

Eurozone PMI composite hits 17-mont high, services lead while France drags

Eurozone business activity accelerated in October, with PMI Composite rising to a 17-month high of 52.2 from 51.2, signaling the strongest expansion since mid-2024. The pickup was driven by services, where PMI Services index jumped from 51.3 to 52.6, a 14-month high, while Manufacturing finally edged up to the neutral 50.0 mark after months of contraction.

However, the upturn remains uneven across major economies. Cyrus de la Rubia, Chief Economist at Hamburg Commercial Bank, noted that France has increasingly become a drag, with its rate of contraction accelerating for two straight months amid political turmoil and budget disputes under Prime Minister Sébastien Lecornu. In contrast, Germany’s outlook "brightened significantly", helping to lift the bloc’s overall figures. Still, manufacturing has been “stagnating for practically six months,” de la Rubia said, and weak new orders leave “little hope of a turnaround.”

Inflation trends offer some comfort for policymakers. Price pressures in the services sector — a key focus for the ECB — “remain moderate,” with sales price inflation slightly higher but still near long-term averages. The PMI data are therefore unlikely to alter the ECB’s cautious stance, reinforcing expectations that officials will hold off on further rate cuts until clearer signs of sustained disinflation emerge.

Japan CPI core Rises to 2.9%, ending three-month slowdown

Japan’s inflation picked up in September, with core CPI (excluding fresh food) rising from 2.7% to 2.9% yoy, matching expectations and marking the first acceleration in four months. The key gauge has stayed at or above the BoJ’s 2% target since April 2022. Headline CPI also rose from 2.7% to 2.9% yoy, in line with the core measure.

Underlying momentum was uneven. Core-core CPI, which strips out both energy and fresh food and is considered a closer measure of domestic demand, slowed to 3.0% from 3.3% yoy, suggesting that broader inflationary pressures are gradually easing.

Food prices continued to rise, but at a slower pace — non-fresh food prices gained 7.6%, down from 8.0% in August. Rice prices, which spiked earlier this year, rose 49.2%, their fourth consecutive month of deceleration after peaking at more than 100% growth in May.

Meanwhile, service prices, a metric closely watched by the BoJ for its link to wage growth, increased 1.4%, slightly below August’s 1.5%.

Japan PMI composite falls to 50.9, weak Yen keeps inflation hot

Japan’s private sector lost further momentum in October, with both manufacturing and services activity softening, according to S&P Global’s Flash PMI survey. The Manufacturing PMI slipped from 48.5 to 48.3, extending its contraction, while Services PMI fell from 53.3 to 52.4. As a result, Composite index eased from 51.3 to 50.9, signaling the slowest pace of overall growth since May.

Annabel Fiddes, Economics Associate Director at S&P Global Market Intelligence, said the survey showed the first decline in new business in 16 months. While the services sector remained the key driver of growth, its fading strength “will be a point of concern” as manufacturing continues to struggle. The factory sector’s downturn deepened, with new orders falling at the fastest pace in 20 months.

Inflationary pressures, however, remained elevated. Both input costs and output charges continued to rise at historically strong rates, driven by higher wage, fuel, and material costs, and alongside by a weaker Yen.

Australia PMI composite ticks up to 52.6, easing inflation keeps RBA on easing track

Australia’s private sector activity sent mixed signals in October, according to the S&P Global Flash PMI survey. Manufacturing PMI slipped back into contraction, falling from 51.4 to 49.7, while Services PMI rose to 53.1 from 52.4, lifting the Composite PMI modestly from 52.4 to 52.6. The data suggest that overall business activity grew at a slightly faster pace at the start of Q4, though the underlying picture remains uneven across sectors.

According to Jingyi Pan, Economics Associate Director at S&P Global Market Intelligence, the divergence between sectors was striking. Manufacturing “notably worsened,” with new orders dropping further and factories shedding jobs amid pressure on profit margins.

In contrast, services activity expanded at a solid pace, but even there, new business growth and hiring momentum slowed, and business confidence weakened.

On a positive note, price pressures continued to ease, with output price inflation falling to a five-year low. This cooling in inflation dynamics should reassure the RBA, which remains on track to pursue further monetary easing.

USD/JPY Mid-Day Outlook

Daily Pivots: (S1) 152.01; (P) 152.40; (R1) 152.99; More...

Intraday bias in USD/JPY is turned neutral with current retreat, and some consolidations would be seen. Another rise is in favor as long as 55 4H EMA (now at 151.56) holds. Above 153.05 will target 153.26, and then 100% projection of 142.66 to 150.90 from 145.47 at 153.71. Firm break there would prompt upside acceleration to 161.8% projection at 158.80.

In the bigger picture, current development suggests that corrective pattern from 161.94 (2024 high) has completed with three waves at 139.87. Larger up trend from 102.58 (2021 low) could be ready to resume through 161.94 high. On the downside, break of 145.47 support will dampen this bullish view and extend the corrective pattern with another falling leg.

US inflation ticked higher in September, but the details of the report suggested price pressures are cooling beneath the surface. Headline CPI accelerated to 3.0% yoy, up from 2.9% but slightly below expectations of 3.1%. That marks the highest level since January.

Though, core CPI — excluding food and energy — slowed from 3.1% to 3.0%, undershooting forecasts and easing from 3.1% in the previous two months. After holding at 3.1% for two consecutive months, the core rate could be entering into a gradual downtrend.

On a monthly basis, headline prices rose 0.3% mom, while core prices increased just 0.2%, both softer than expected. Energy costs were again the key driver of the headline gain, with the gasoline index surging 4.1% and the broader energy index up 1.5%. Food prices also continued to edge higher, rising 0.2% as grocery costs climbed more sharply than dining-out prices.

Full US CPI release here.

Key takeaways

• Japan 225 CFD Index rally: The Japan 225 CFD Index (Nikkei 225 proxy) reached an all-time high of 49,970 on optimism over PM Takaichi’s more than ¥13.9 trillion expansionary stimulus plan.
• Market pullback: The index declined 3.4% from its peak, suggesting investors had already priced in expectations of aggressive fiscal measures.
• Earnings momentum: Forward 12-month EPS growth for Nikkei 225 stocks rose to 9.3% in October from 7% in September, signaling an improving corporate outlook.
• Foreign inflows strengthen: Net foreign purchases of Japanese equities surged sharply, reinforcing continued medium-term bullish momentum for Japan’s equity market.

The Japan 225 CFD Index (a proxy of the Nikkei 225 futures) has rallied as expected and almost hit the first medium-term resistance of 50,090/50,220 highlighted in our previous publication. It printed a fresh all-time intraday high of 49,970 on 21 October 2025, on the backdrop of the newly appointed Japanese Prime Minister Takaichi’s plan for implementing an expansionary stimulus package that is likely to be more than 13.9 trillion yen that centered on measures to counter inflation, investment in growth industries, and national security.

However, the Japanese stock market appears to have already priced in expectations of an aggressive expansionary fiscal policy, as hinted in Prime Minister Takaichi’s previous speeches. The Japan 225 CFD Index has since declined by 3.4% from its all-time high on 21 October 2025, hitting an intraday low of 48,415 on Thursday, 23 October 2025.

This raises an important question, is the medium-term uptrend that has been in place since April 2025 at risk of reversing, given the potential for rising longer-term Japanese Government Bond (JGB) yields amid concerns over a widening fiscal deficit from Takaichi’s policy stance?

Fundamental, flow, and momentum factors are still supportive for a further potential progression of the ongoing medium-term uptrend phase for the Japan 225 CFD Index. Let’s examine each of them.

Nikkei 225 forward earnings growth has picked up

Fig. 1: Nikkei 225 forward 12-month forward EPS growth as of 23 Oct 2025 (Source: MacroMicro)

The forward 12-month earnings per share (EPS) growth for the component stocks of the Nikkei 225 in aggregate has started to improve after a slowdown in the past 11 months. The forward EPS growth of the Nikkei 225 has recently increased to 9.3% year-on-year in October 2025 from 7% in September 2025 (see Fig.1).

This earnings growth uptick suggests that more sell-side analysts have raised earnings projections for the Nikkei 225 for Q3 earnings results that may propel the Nikkei 225 higher.

Net foreign inflows into the Japanese stock market have increased significantly

Fig. 2: Net purchases of Tokyo & Nagoya stock exchanges as of 17 Oct 2025 (Source: MacroMicro)

The 52-week average of net purchases of Japanese equities listed on the Tokyo and Nagoya stock exchanges has jumped by a significant amount from 6.2 billion in the week of 8 August 2025 to 81.5 billion as of 17 October 2025 (see Fig. 2).

We shall focus on the short-term (1 to 3 days) trajectory, key elements, and key levels to watch on the Japan 225 CFD Index from a technical analysis/momentum perspective.

Preferred trend bias (1-3 days) – Oscillating within minor & medium-term ascending channels

Fig. 3: Japan 225 CFD Index minor trend as of 24 Oct 2025 (Source: MacroMicro)

Maintain bullish bias with 48,845/48,440 as key short-term pivotal support for the Japan 225 CFD Index. A clearance above 49,560 key near-term resistance (upside trigger) opens up scope for the next resistances to come in at 50,090/50,220 and 50,860/51,030 (Fibonacci extension cluster) (see Fig. 3).

Key elements

• Since the key minor swing low of 45,145 on 10 October 2025, induced by US President Trump’s “China trade tariffs bashing”, the price actions of the Japan 225 have been oscillating within a minor ascending channel.
• The hourly RSI momentum indicator of the Japan 225 CFD Index has continued to show a bullish momentum condition since its bullish divergence signal on Wednesday, 22 October 2025.

Alternative trend bias (1 to 3 days)

A break below the 48,845/48,440 key short-term support negates the bullish tone for another extension of the minor corrective decline towards the next intermediate support at 47,260 (also the 20-day moving average).

At the start of the month, the BTC/USD rate was hovering around $115k. Historically, October and November have been months when the price of the leading cryptocurrency has shown its strongest gains. A rise towards a new all-time high (ATH) could have continued this “tradition”; however, following Trump’s statement about the potential introduction of 100% tariffs on trade with China, the coin’s price plummeted to $105k. And although the meeting between US and Chinese leaders scheduled for 30 October was expected to ease some concerns, as we can see, Bitcoin’s price has not yet fully recovered from the shocking crash on 10 October. The question of whether the month will turn out to be bullish therefore remains open.

BTC/USD chart analysis shows that price fluctuations since early May have formed an ascending channel, with key reversals marked in red and blue.

Bullish Perspective

Recent news has created a positive fundamental backdrop:

→ Trump has pardoned Binance founder Changpeng Zhao (known as CZ), who in turn suggested that Bitcoin’s market capitalisation could surpass that of gold.

→ Analysts at VanEck believe that the market remains bullish, and that the October decline is merely a correction.

Notably, in October Bitcoin’s price dipped below several key support levels:

→ On 10 October it fell below the September low and the psychological $105k level.

→ On 17 October – below the 10 October low.

The subsequent rebounds confirm that:

→ the lower boundary of the channel remains relevant;

→ buyers were aggressive and successful, as Bitcoin’s price quickly rebounded towards $110k.

From this, it is reasonable to assume that in October, Smart Money used selling flows to build long positions (the 17 October drop resembles a Liquidity Grab pattern).

Bearish Perspective

The wide range between $116k and $120k appears to be a strong resistance zone, as sellers held clear dominance there just two weeks ago.

Arrows on the chart indicate that selling pressure was both aggressive and effective:

1 → pushing the price down from the blue median;

2 → around the $114k level this week.

Conclusion

At present, Bitcoin’s price is near the QL line, which divides the mentioned channel into its two lower quarters – an area where the price may find short-term balance. Today’s US inflation data release will largely determine the next move:

→ upward towards the median (which would improve the chances of a bullish October);

→ downward towards the channel’s lower boundary (which would once again test the bulls’ ability to defend the $105k level).

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Market Overview

The crypto market capitalisation grew by 1.5% in 24 hours to $3.76 trillion. This is a return to the highs seen at the start of the week. A reversal below this level will be further confirmation of the formation of a sequence of declining local peaks. The last two Fridays have been bearish, so there is a risk that a reflex will form with increased selling before the weekend.

Bitcoin is trading near $111K, close to Thursday’s intraday highs and Monday’s downward reversal area. From a technical analysis perspective, BTCUSD remains trapped between the 200-day moving average below (around $108.5K) and the 50-day moving average above (just above $114K). A sustained breakout from this range could signal further movement in the direction of the breakout.

Ethereum is up 2.7% since the start of the day on Friday, again approaching $4,000. Over the past two weeks, the area around $3,700 has proven to be an important support level. Whether it will continue to withstand further pressure from sellers depends on global market sentiment and the outcome of BTC’s breakout from the range.

News Background

Speculative activity in the market is declining, and recent cryptocurrency buyers are experiencing ‘financial stress,’ which is a sign of a cooling market, Glassnode notes. However, historically, such periods have often led to price stabilisation.

Open interest in Bitcoin options has reached record highs, driven by increased demand for puts. BRN warns of increased volatility and the risks of a continued correction in the first cryptocurrency.

The days of self-storage of cryptocurrencies are coming to an end, as large players increasingly prefer ETFs due to tax benefits and improvements in institutional infrastructure, according to Uphold.

Since January, the volume of transactions with stablecoins has reached $46 trillion, 106% more than in the same period last year. A16z Crypto considers this factor to be the main indicator of the maturity of the crypto industry.

US President Donald Trump has pardoned former Binance CEO Changpeng Zhao. According to White House press secretary Caroline Levitt, ‘Zhao was prosecuted by the Biden administration as part of their war on cryptocurrencies.’