· Treasury yields were lower on Friday after muted underlying U.S. inflation data offset higher gasoline prices and strong retail sales while the U.S. dollar regained ground but was set for its worst week in five.
· U.S. consumer prices recorded their biggest increase in eight months in September as gasoline prices soared in the wake of hurricane-related refinery disruptions, but underlying inflation remained muted.
· U.S. retail sales recorded their biggest increase in 2-1/2 years in September as demand rose for building materials and motor vehicles in areas hurt by hurricanes Harvey and Irma. The inflation data could curb future rate hikes while others eyed trade discussions and retail data.
· The dollar index, which tracks the greenback against six major currencies, was up 0.02 percent at 93.072 after falling to a more than two-week low of 92.749. The index was down about 0.75 percent for the week, its worst weekly performance in five.
· The euro was down 0.07 to $1.1821 after European Central Bank President Mario Draghi said the euro zone continues to need substantial monetary stimulus as the ECB has not yet managed to increase inflation sufficiently.
“Draghi did definitely pour some cold water on expectations around ECB’s Oct. 26 meeting,” said Schamotta.
· Federal Reserve Chair Janet Yellen on Sunday sketched a bright outlook for the U.S. economy and for inflation prospects in coming months, saying the impact of the recent hurricanes will likely slow economic growth slightly but only temporarily and should be followed by a rebound by year's end.
Her comments suggested that the central bank will soon resume raising interest rates to reflect the strengthening economy. Most economists foresee the next rate hike -- the third this year -- coming in December.
· U.S. President Donald Trump refused on Friday to formally certify that Tehran was complying with the 2015accord even though international inspectors say it is. He warned he might ultimately terminate the agreement.
German Foreign Minister Sigmar Gabriel told Deutschlandfunk radio that Trump had sent a “difficult and dangerous signal” when the U.S. administration was also dealing with the North Korea nuclear crisis.
If the United States terminates the Iran nuclear deal or reimposes sanctions on Tehran it could result in Iran developing nuclear weapons and raise the danger of war close to Europe, Germany’s foreign minister said on Saturday.
· Secretary of State Rex Tillerson said Sunday that President Donald Trump had instructed him to continue diplomatic efforts to calm rising tensions with North Korea, saying “those diplomatic efforts will continue until the first bomb drops.”
· U.S. President Donald Trump will hurt low-income Americans by doing away with Obamacare subsidies and make it harder for him to engage in bipartisan talks with Democrats as Congress edges toward a possible government shutdown, lawmakers said on Sunday.
The White House has announced that the Republican administration will stop paying billions of dollars to insurers to help low-income consumers meet out-of-pocket medical expenses, as part of the president’s step-by-step effort to dismantle the Affordable Care Act, Democratic former President Barack Obama’s signature healthcare law.
The expected loss of cost-sharing subsidies, estimated to be worth $7 billion this year and $10 billion in 2018, has prompted worries about insurance market chaos and undermined the prices of insurer and hospital company shares.
· Wages and inflation in the 19-country euro zone will eventually rise but more slowly than earlier thought, requiring continued patience from policymakers, European Central Bank President Mario Draghi said on Saturday.
Wage growth has failed to respond to stimulus for a list of reasons but the ECB remains convinced that labor markets and not a structural change in the nature of inflation is the chief culprit behind low prices, Draghi told a news conference on the sidelines of the International Monetary Fund annual meeting.
Commercial real estate values in the euro zone look stretched, but there are no signs of bubbles in broader European markets, according to the president of the European Central Bank.
Speaking at a press conference at IMF Annual Meetings in Washington, Mario Draghi said he does not see evidence that stocks or bonds are overpriced in Europe.
· Prime Minister Theresa May travels to Brussels on Monday for talks with EU chief Jean-Claude Juncker after deadlock in Brexit talks appeared to dash British hopes that a summit later in the week could launch negotiations on future trade ties.
· Oil prices on Friday closed at their highest level in October on bullish news from strong Chinese oil imports, U.S. President Donald Trump’s decision not to certify that Iran is complying with a nuclear agreement and other tensions in the Middle East.
Brent LCOc1 futures gained 92 cents, or 1.6 percent, to settle at $57.17 a barrel, while U.S. crude CLc1 rose 85 cents, or 1.7 percent, to settle at $51.45 per barrel.
That put both contracts at their highest settlements since Sept. 29. For the week, Brent was up almost 3 percent and U.S. was up over 4 percent.
· Chinese oil imports hit 9 million barrels per day (bpd) in September, data showed. Imports averaged 8.5 million bpd between January and September, solidifying China’s position as the world’s biggest oil importer.
· Kurdish authorities have sent thousands more troops to the oil region of Kirkuk to confront “threats” from Iraq’s central government, the vice president of the autonomous Kurdistan region said.
Reference: Reuters, CNBC
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