27 October 2026: TMGM Daily Market Breakfast

Markets at a Glance

• $101.00 per barrel was reclaimed by WTI crude on Tuesday. Vessels attempting to transit the Strait of Hormuz continued to face attacks despite diplomatic efforts across the region.
• Decisive action in the foreign exchange market remained an option for the government, Japanese Finance Minister Satsuki Katayama said.
• £20.4 billion in extra investment through the National Wealth Fund and British Business Bank is indicated by UK Autumn Budget reports, according to Deutsche Bank economists.
• With the ECB’s policy rate at 2.50% after September’s 25-basis-point increase, attention remained on France’s fiscal pressures and bond-market tensions.
• Four Houthi drones aimed at southern Saudi Arabia were intercepted and destroyed, the Saudi-led coalition said.
• Final OCC approval for the Ripple National Trust Bank charter was announced by Ripple CEO Brad Garlinghouse.
• Subject to regulatory approval, Kraken parent Payward is Hyperliquid’s intended first CFTC-regulated deployer of perpetual futures markets on HIP-3.
• For China’s current-account surplus, Standard Chartered lifted its forecasts to 4.0% of GDP in 2026 and 3.6% in 2027.

Cross-Asset Update

Currency Markets

102.00 came into view as the U.S. Dollar Index advanced on Monday. Despite a stronger-than-expected German Ifo survey, EUR/USD hit its lowest level since October 15 on Monday before extending losses to around 1.1170 early Tuesday. After losing about 0.22% to 1.3342 on Monday, GBP/USD traded around 1.3335 early Tuesday. Sterling subsequently gained against the euro later Tuesday. Monday’s move in USD/JPY took the pair from just above 156.50 to just above 157.50; gains continued on Tuesday for a third successive session. A 0.26% Monday decline left AUD/USD at 0.7016, followed by a recovery to around 0.7025 in Tuesday’s Asian session. Having ended a seven-day losing run on Monday, USD/CAD rose for a second day on Tuesday to around 1.4020.

Gold Price Action

A 0.6% gain on Monday returned gold above $4,000, the level below which it had ended the previous week. A firmer U.S. dollar then weighed on the metal in Tuesday’s Asian session, although prices held above $4,000.

Energy Markets & Security Developments

$101 Reclaimed by WTI Amid Continued Hormuz Attacks

Above $101.00 per barrel, WTI crude recovered on Tuesday. Prices reversed an earlier slide to around $100.10 in Asian trading. That initial decline had marked a second consecutive day of losses, as fresh Middle East diplomatic efforts fuelled hopes that a broader escalation of the U.S.-Iran conflict could be avoided.

Fading expectations of a peace deal and continued attacks on vessels seeking to cross the Strait of Hormuz accompanied the subsequent rebound. Talks nonetheless continued. According to Iranian broadcaster IRIB, high-level meetings in Tehran led Iran, Saudi Arabia, Pakistan and Turkey to agree on Monday to maintain security discussions and strengthen regional cooperation.

Fiscal Policy & Monetary Authorities

Japan Signals Readiness for Decisive FX Action

Decisive steps in the foreign exchange market were an option the government was prepared to take, Japanese Finance Minister Satsuki Katayama said on Tuesday. Officials were watching market movements with heightened urgency, she added, including at the time she spoke.

Rather than confirming an intervention, the comments signalled a willingness to act.

£20.4 Billion in Extra Investment Indicated by UK Budget Reports

An additional £20.4 billion of investment through the National Wealth Fund and British Business Bank is indicated by Financial Times and The Times reporting, according to Deutsche Bank economists Sanjay Raja and Maui Brennan. Weighted towards the period from 2028/29, the proposed expansion would channel increased investment through financial transactions by public financial institutions.

An £8 billion expansion in the Autumn Budget, matched by a further increase in the following year’s Spending Review, had been Deutsche Bank’s earlier assumption. By contrast, the reported proposals pointed to roughly £20 billion in extra investment over five years, the economists said.

After factoring in slightly higher HMRC savings, Deutsche Bank put the annual increase in borrowing at nearly £10 billion towards the end of the Office for Budget Responsibility’s forecast horizon. The gross financing requirement would reach just over £250 billion in 2030/31. Applying OBR multipliers, the bank estimated that GDP would be 0.5% higher by 2031/32. These calculations reflect economists’ assessments of reported proposals, rather than announced Budget measures.

2.50% ECB Rate Frames Focus on France’s Fiscal Strains

Fiscal difficulties and bond-market pressures in France continued to draw euro-area attention. Highlighting those concerns, Brown Brothers Harriman strategist Elias Haddad noted that September’s 25-basis-point increase had taken the ECB’s policy rate to 2.50%.

With underlying euro-area inflation contained and financial conditions tighter, policymakers had room to wait, Haddad said. Concerns over France’s finances also pressured the euro against sterling on Tuesday.

Regional Security Update

Four Houthi Drones Destroyed, Saudi-Led Coalition Says

Four drones launched by the Houthis towards southern Saudi Arabia were intercepted and destroyed by the Saudi-led coalition’s air defences on Tuesday, the coalition said, according to Reuters.

Digital-Asset Markets & Regulatory Developments

Final OCC Approval Secured for Ripple National Trust Bank

The Office of the Comptroller of the Currency had given final approval for the Ripple National Trust Bank charter, Ripple CEO Brad Garlinghouse said in a Monday post on X. The approval establishes a federally supervised institution.

Managing reserves that back Ripple USD, or RLUSD, is now permitted under the approval, which also broadens the bank’s digital-asset custody services. Federal oversight of the infrastructure supporting RLUSD comes through the trust-bank structure. Ripple’s Standard Custody & Trust Company issues RLUSD.

Payward Targets Regulated U.S. Perpetual Futures via Hyperliquid

Payward, parent of cryptocurrency exchange Kraken, was selected by Hyperliquid as its intended first Commodity Futures Trading Commission-regulated deployer on HIP-3 markets. In a Monday post on X, Hyperliquid said the infrastructure would be used under Payward’s plans to launch perpetual futures markets for U.S. customers. Regulatory approval is still required for the arrangement.

Creation, ownership and administration of the proposed markets would sit with Bitnomial, Payward’s CFTC-regulated designated contract market and derivatives clearing organisation. Bitnomial would also manage clearing and settlement.

Optional on-chain allowlists introduced by HIP-3 let deployers limit access without giving up independent control over their markets. Plans to extend perpetual futures models to individual stocks through Bitnomial’s regulated exchange and clearing services had previously been outlined by Payward.

China’s External-Sector Position

4.0% of GDP: Standard Chartered Lifts China’s 2026 Surplus Forecast

China’s 2026 current-account surplus is now forecast at 4.0% of GDP, up from 2.5%, by Standard Chartered economists Shuang Ding and Hunter Chan. A goods trade surplus above expectations and a services trade deficit below expectations in the first half of 2026 were the main reasons for the upgrade, they said.

For 2027, the economists lifted their surplus projection from 2.0% to 3.6% of GDP. They expected the structural factors underpinning China’s external-sector strength to continue. These numbers are the bank’s forecasts, not official current-account outcomes.

Key Dates Ahead

• Federal Reserve Monetary Policy Announcement — 2026-10-28; time unspecified: United States: At the close of its meeting, the FOMC announces its monetary policy decision.
• UK Autumn Budget Presentation — 2026-10-28; time unspecified: United Kingdom: Tax and spending proposals are presented by the government.
• Bank of Canada Rate Announcement — 2026-10-28; time unspecified: Canada: The interest-rate decision is announced by the central bank.
• European Central Bank Monetary Policy Announcement — 2026-10-29; time unspecified: Eurozone: The monetary policy decision is announced by the ECB.
• Bank of Japan Monetary Policy Announcement — 2026-10-30; time unspecified: Japan: The monetary policy decision is announced by the central bank.
• Australia Consumer Price Inflation Data — Australia: The next consumer price inflation release is upcoming, with no date or time specified.
• Canada GDP Data — Later this week; date and time unspecified: Canada: The GDP release is scheduled for later in the week.