Daily Financial Breakfast 19 October 2026: China GDP Grows 4.5% While Iran’s IRGC Says Tanker Hit Mine

Market News Today: Key Takeaways

• China’s economy grew 4.5% year-on-year in the third quarter, exceeding the 4.4% consensus forecast and the previous reading of 4.3%.
• Iran’s IRGC said an oil tanker struck a mine and caught fire in the Strait of Hormuz as maritime authorities reported separate attacks on commercial vessels.
• President Donald Trump said his Russian diesel deal and decision to block sanctions were intended to keep Moscow engaged in peace talks, while Brent opened lower near $108 per barrel on Monday.
• Bank of Japan Governor Kazuo Ueda said underlying inflation was near the central bank’s 2% target.
• RBA Assistant Governor Chris Kent said there were reasonable indications that neutral interest rates were increasing in Australia and globally, while stressing uncertainty over their level.

Market Developments

Foreign Exchange

EUR/USD weakened to around 1.1215 in early Asian trading on Monday amid concerns over French fiscal risks. USD/CHF retreated from its opening level to around 0.8240 during Asian hours, although it remained higher on the session. USD/JPY was broadly steady around 158.00 in early European trading.

Gold

Gold rose to around $4,175 in early Asian trading on Monday as expectations of a Federal Reserve rate increase faded and geopolitical tensions remained in focus.

Economic Data

China’s Third-Quarter GDP Growth Reaches 4.5%, Beating Forecasts

China’s gross domestic product expanded 4.5% year-on-year in the third quarter, the National Bureau of Statistics reported on Monday. Growth exceeded the market consensus of 4.4% and accelerated from the previous reading of 4.3%.

Geopolitics & Energy

Iran’s IRGC Says Tanker Struck Mine in Strait of Hormuz

Iran’s Islamic Revolutionary Guard Corps said on Sunday that an oil tanker caught fire and exploded after striking a naval mine in the southern Strait of Hormuz, the Times of Israel reported. Separately, maritime authorities reported several attacks on commercial vessels around the strait, according to CNBC.

Mohsen Rezaei, a secretary of Iran’s Supreme National Security Council, said Tehran had prepared a new retaliation plan for any renewed US-Israeli attack, CNBC reported. OCBC strategists said Iranian attacks on commercial shipping had intensified and broadened beyond tankers, while escalating Saudi-Houthi tensions had renewed attention on Saudi Arabia’s alternative export infrastructure.

A Saudi-led coalition intercepted a ballistic missile headed towards Yanbu on Friday, OCBC said. Saudi Arabia’s East-West Pipeline can carry around 7 million barrels per day to the Red Sea and was operating at 5.8 million barrels per day in early October.

Brent rose 3.7% to just under $110 per barrel on Friday and recorded a second consecutive weekly gain, advancing 4.9%, according to Commerzbank. OCBC said Brent briefly touched $110 before paring gains. Commerzbank attributed the rally to renewed supply concerns involving Houthi attacks on Saudi Arabia and strikes on Russian energy infrastructure, despite a significant recovery in Middle Eastern oil exports, partly through tanker “dark transits” of Hormuz.

The International Energy Agency agreed to accelerate its remaining emergency stock releases, including more than 20 million barrels of diesel, while the United States solicited an exchange of up to 17 million barrels of Strategic Petroleum Reserve crude, OCBC said. Both measures were part of the emergency response agreed earlier this year, rather than entirely new supply commitments.

Trump Says Russian Diesel Deal Was Intended to Preserve Peace Talks

President Donald Trump said he agreed a diesel export deal with Russia and blocked numerous sanctions because he did not want to drive Vladimir Putin away from peace talks with Ukraine, Bloomberg reported on Sunday.

Trump had signed an executive order on Friday waiving key Russia-related sanctions and tariffs under the Graham Act shortly before they were due to take effect, Danske Bank said. The measures included restrictions targeting Russian goods and countries buying Russian oil and gas. Secretary of State Marco Rubio said Trump would use up to 60 days to assess the economic impact and defended a separate agreement for Russia to increase diesel supplies to US and global markets.

EU leaders meeting in Brussels maintained their commitment to sanctions and support for Ukraine. Ursula von der Leyen said sanctions would not be lifted unless Russia stopped the war and that the EU was working on a 22nd sanctions package. Ukrainian President Volodymyr Zelenskyy called the US waiver “wrong”, saying it would help Moscow and prolong the war. On Sunday, he also said US intelligence-sharing had resumed and that he had discussed diplomatic next steps with Trump’s envoys.

Brent opened lower around $108 per barrel on Monday following the waiver, according to Danske Bank. WTI fell to around $97.40 during Asian trading after seven days of gains and subsequently eased below $97 in early European trading. Ukraine struck Russian energy infrastructure on Sunday, Danske Bank said.

Central Banks

BoJ’s Ueda Says Underlying Inflation Is Near 2% Target

Bank of Japan Governor Kazuo Ueda said on Monday that underlying inflation was near the central bank’s 2% target. He also said that, if the bank raised its short-term policy rate, long-term interest rates would likely rise steadily alongside policy.

RBA’s Kent Says Neutral Rates Show Signs of Increasing

Reserve Bank of Australia Assistant Governor Chris Kent said on Monday that there were reasonable indications neutral interest rates were increasing domestically and globally. He cautioned that high uncertainty made the neutral rate difficult to pinpoint.

Upcoming Key Events

• Japan National Consumer Price Index (23 October 2026): Japan is scheduled to release its national consumer price inflation data on Friday.