The resulting slide in the US dollar more than offset downward pressure from weaker-than-expected domestic employment data, which led investors to pare back expectations of a Reserve Bank rate hike in December. Markets are now pricing in less than a 50% probability of a rate increase next month, down from about 75% earlier in the week.

Investor focus is now shifting to New Zealand’s general election on Saturday, with opinion polls pointing to a closely fought contest between the incumbent centre-right National-led coalition and opposition parties led by the centre-left Labour Party.

President Donald Trump acknowledged that Republicans lost ground in the elections partly because of the war and noted that high gasoline prices contributed to the defeat. He also signaled that there were no immediate plans to intensify military action against Iran. Softer oil prices could help relieve inflationary pressures, easing worries about potential interest rate hikes in the near term.

Market participants are now focused on Friday’s closely watched US employment report, which could shape expectations for the Federal Reserve’s next policy moves. According to the CME FedWatch Tool, traders currently assign a 79% probability to a Fed rate increase in December.

On the price front, both input costs and output charges rose at a slower pace, suggesting some easing in inflationary pressures, even though inflation stayed well above its historical norm. Looking ahead, business confidence slipped to its lowest level since March, as concerns about inflation, population ageing, and persistent labor shortages weighed on the outlook.

This pullback came despite overnight gains on Wall Street. The Philadelphia Semiconductor Index (SOX) slid 3.1% to a six-month low amid fears that a Democrat-controlled Congress could introduce stricter rules on AI data centers, potentially increasing the cost of power grid expansion and leading to permitting delays.

Semiconductor names led the sell-off in Seoul, with Samsung Electronics (-5.16%) and SK hynix (-7.09%) among the sharpest decliners. Other major stocks also retreated, including LG Energy Solution (-2.11%), Hanwha Aerospace (-5.03%), and Doosan Enerbility (-3.98%).

Transport inflation jumped to 20.1% from 14.6%, while inflation for housing, water, electricity, gas, and other fuels climbed to 9.3% from 8.4%. The ongoing conflict in the Middle East has pushed up energy costs in the Philippines, which is highly dependent on supplies from the region.

Price pressures also intensified in several other categories: restaurants and accommodation services (7.7% vs 7%), health (5.9% vs 5.6%), and furnishings and household equipment (5% vs 4.7%). By contrast, inflation for food and non-alcoholic beverages eased to 6.1% from 6.7%.

On a monthly basis, consumer prices increased by 0.7% in October, following a 1.0% rise in September. Core inflation accelerated to 5.4%—its highest level since September 2023—from a revised 4.8% in September, also coming in above market expectations of 4.8%.

Growth in services activity picked up slightly, but this was more than offset by a slowdown in manufacturing output. Overall new orders rose at the same modest pace as in September, and total sales continued to be supported by stronger export demand. However, growth in new export business eased to a four-month low.

On the labor front, employment growth weakened to its slowest pace in a year. At the same time, business confidence regarding activity in the year ahead fell to a three-month low, pointing to a more cautious outlook among firms.

In terms of prices, input costs continued to increase sharply by historical standards. However, the rate of inflation in output prices eased to a four-month low, indicating some moderation in firms’ price-setting pressures.

Exports of general merchandise increased 2.9% from the previous month to AUD 42.05 billion. This was largely driven by a 3.6% rise in rural goods exports to AUD 6.4 billion, supported by stronger shipments of meat and meat preparations (up 11.3%) and other rural goods (up 3%).

Non-rural goods exports advanced 2.8% to AUD 35.6 billion, reflecting higher shipments of metal ores and minerals (up 2.3%), other mineral fuels (up 6.6%), metals excluding non-monetary gold (up 23.5%), and other manufactured products (up 4.6%).

By contrast, exports of non-monetary gold slipped 1.6% to AUD 6.3 billion.

In Japan, retailers and automakers led the rebound, with strong advances from Fast Retailing (9.5%), Nintendo (5.3%) and Toyota Motor (6.9%). Banking shares also strengthened, including Mitsubishi UFJ (3.2%) and Sumitomo Mitsui (1.7%).

By contrast, technology and artificial intelligence-related names lagged, as investors assessed how Democratic control of the US Congress might affect data-center development. Among the notable decliners were Kioxia Holdings (-7.3%), Advantest (-8.5%) and SoftBank Group (-6.2%).

Exports increased 2.3% month-on-month to AUD 48.43 billion in September, a 42‑month high, though the pace eased from a downwardly revised 3.1% rise in August. The increase was led mainly by higher shipments of other mineral fuels and metals.

In contrast, imports declined 3.3% month-on-month to AUD 45.61 billion, following an upwardly revised 6.2% gain in August. The pullback was largely due to lower imports of non-monetary gold, civil aircraft, and confidentialised items.

Capital goods imports fell 2.5% to AUD 12.89 billion, weighed down by a steep drop in civil aircraft and confidentialised items (-33.7%), as well as lower imports of machinery and industrial equipment (-3.7%) and telecommunications equipment (-1.4%).

Consumption goods imports also declined, falling 2.2% to AUD 12.54 billion. This reflected reduced purchases of non-industrial transport equipment (-4.0%), food and beverages (-3.6%), and other consumption goods n.e.s. (-0.4%).

Imports of non-monetary gold recorded an even sharper contraction, plunging 34.7% to AUD 2.06 billion.

By contrast, imports of intermediate and other merchandise goods inched up 0.9% to AUD 18.12 billion, supported by higher inflows of fuels and lubricants (2.3%), parts for transport equipment (2.3%), and processed industrial supplies n.e.s. (0.8%).

The October 2026 print suggests a slight strengthening in business conditions for Japan’s service providers, building on the prior month’s expansion. While the gain is incremental, the move higher in the PMI points to continued resilience in the services economy, a key component of Japan’s overall growth profile.

Investors and policymakers will be watching upcoming releases to gauge whether this upward momentum can be sustained, particularly amid global economic uncertainty and shifting financial conditions. For now, the October rise offers a cautiously positive signal on the health of Japan’s domestic demand and services activity.

On a month-over-month basis, the indicator’s slight decline points to a softer pace of growth across both manufacturing and services, though the level above 50 still indicates overall expansion. Both the “previous” and “current” readings refer to October 2026, with the current figure reflecting a marginal loss of momentum relative to the prior month’s performance. Investors and policymakers will be watching upcoming releases closely to see whether this easing is temporary or the start of a more pronounced slowdown in Japan’s economic activity.

In Wednesday’s regular session, the Dow jumped 3.03%, adding 1,569 points to close at a two-month high. The S&P 500 rose 1.58%, and the Nasdaq Composite gained 1.44%. Consumer discretionary, financial and real estate stocks led the advance, while energy and industrial shares lagged. Market participants are now looking ahead to Thursday’s earnings reports from ConocoPhillips, Kimberly-Clark and Airbnb.

The previous reading showed that CPI climbed 1.0% in September compared with August, while the October result indicates a weaker pace of price growth compared with September. The data suggest some easing in short-term inflation pressures as monthly gains in consumer prices decelerate.

According to the comparison methodology, the “actual” October figure measures the change in prices from September to October, whereas the “previous” measure tracked the change from August to September. The step down from 1.0% to 0.7% signals that, although prices continued to rise, they did so at a slower rate heading into the final quarter of 2026.

Both the current and previous readings reflect year-over-year comparisons: the October figure measures price changes against October of the prior year, while the September reading compares prices with September a year earlier. The uptick from 7.2% to 7.8% signals that inflationary trends in the Philippines remain firmly entrenched, keeping cost-of-living concerns in focus for households and investors alike.

On a year-over-year basis, the October figure reflects a stronger increase in core prices compared with the same month a year earlier, and marks a faster pace than in September, when the core CPI was also measured against the same month of the previous year. This shift suggests that price gains are becoming more entrenched across a broader range of goods and services.

The pickup from 4.7% to 5.4% in just one month’s comparison underscores the importance of core inflation in assessing the Philippines’ price dynamics beyond temporary shocks. Market participants and policymakers are likely to watch subsequent releases closely to determine whether October’s move signals a sustained trend or a short-term spike in underlying inflation.

President Donald Trump acknowledged that Republicans suffered electoral setbacks in large part because of the conflict, and he cited rising gasoline prices as a key factor. Still, he signaled no immediate intention to intensify military strikes against Iran.

With Democrats now in control of Congress, lawmakers could move to restrict military funding for operations in the Middle East. Senate Minority Leader Chuck Schumer has pledged to press for an end to the conflict.

At the same time, crude exports from the Persian Gulf have started to recover, with supply now outstripping near-term demand. As a result, the US crude benchmark is down about 15% so far this week.

The primary income account surplus also widened, rising to USD 2.65 billion from USD 1.92 billion, while the secondary income deficit narrowed to USD 0.59 billion from USD 0.94 billion, reflecting a reduction in net secondary income outflows. In contrast, the services account deficit deepened to USD 3.35 billion from USD 1.68 billion, mainly due to larger deficits in the use of intellectual property and other business services.

Over the first nine months of 2026, the current account surplus jumped to USD 340.66 billion, compared with USD 89.39 billion in the same period of 2025.

The sharp month‑on‑month increase signals a significant strengthening in South Korea’s external position during the early autumn period. While the specific drivers of the improvement were not detailed in the released figures, the move from 46.11B in August to 61.46B in September points to a notable gain in the country’s overall balance with the rest of the world.

The September reading will be closely watched by markets and policymakers as they assess the trajectory of South Korea’s trade and income flows heading into the final quarter of 2026. The latest data suggest that, at least for September, South Korea’s current account provided a firmer buffer for the economy than in the previous month.

Traders largely looked past Wednesday’s labor market report, even though the unemployment rate unexpectedly rose to an 11-year high of 5.7% in Q3 2026, up from 5.6% in Q2 and contrary to market expectations for a decline to 5.5%.

Nearly all sectors traded higher, with financials, healthcare, and consumer staples among the strongest performers. Notable early gainers included Infratil (up 4.7%), Fletcher Building (2.8%), Westpac Banking Corp. (2.4%), Fisher & Paykel (1.9%), Mainfreight (1.5%), ANZ Group (1.5%), Ebos Group (1.0%), and Freightways Group (0.9%).

Trump also cited elevated gasoline prices as a factor in the Republican defeat, while Vice President JD Vance publicly blamed the war in a post on X. Qatar continues to mediate between the two sides, and Trump told the Financial Times that the United States has no immediate plans to launch strikes against Iran. At the same time, Democratic control of Congress may limit future military spending in the Middle East, fueling expectations of a near-term peace agreement.

On the supply side, fundamentals also pressured prices. A renewal of Gulf exports has pushed the availability of Middle Eastern crude above near-term demand, adding to the downward momentum in the oil market.

By holding the Selic rate steady, policymakers signal ongoing caution over inflation dynamics and financial stability risks. The pause suggests that, for now, the priority remains anchoring price expectations rather than easing monetary conditions to stimulate growth.

Markets and businesses will now focus on upcoming inflation data and central bank communications for clues on when a potential rate-cut cycle might begin, and how quickly policy could normalize from its current restrictive stance.

Canada’s trade surplus widened to C$5.35 billion in September, as stronger energy and gold exports to the U.S. appeared to offset the effects of existing tariffs. In addition, Canada and China extended an agreement to lower Beijing’s agricultural tariffs through the end of 2028.

Auto exporters advanced, with shares of Magna International up 3.9% and BRP surging 7.7%. Miners also rallied as gold prices rose in tandem with a weaker U.S. dollar: Agnico Eagle jumped 9.4%, Barrick added 8%, and Wheaton Precious Metals surged 11.7%.

Softer oil prices supported credit-sensitive financials, with Royal Bank of Canada up 2.5%, Toronto-Dominion Bank and Canadian Imperial Bank of Commerce each gaining 2.4%, and Bank of Montreal rising 2.9%.