• Euro falls to fresh lows on the day
• Eurozone September preliminary CPI +1.8% vs +1.8% y/y expected
• UK September final manufacturing PMI 51.5 vs. 51.5 prelim
• ECB’s Rehn: The scale is tipping towards a rate cut in October
• US, China reportedly set to hold talks on trade and economic ties
• ECB’s Rehn: Direction of monetary policy is clear
• Eurozone September final manufacturing PMI 45.0 vs 44.8 prelim
• Germany September final manufacturing PMI 40.6 vs 40.3 prelim
• France September final manufacturing PMI 44.6 vs 44.0 prelim
• Italy September manufacturing PMI 48.3 vs. 49.0 expected
• Japan prime minister Ishiba unveils new Cabinet members
• Switzerland September manufacturing PMI 49.9 vs 48.0 expected
• Spain September manufacturing PMI 53.0 vs 50.2 expected
• European equities a little mixed at the open today
• Deutsche see ECB cutting rates in October with potential for a 50 bps move in December
• What are the main events for today?
• Eurostoxx futures +0.2% in early European trading
• FX option expiries for 1 October 10am New York cut
• Japan top FX diplomat says yen shorts that had been built up until July have been unwound
• Eurozone inflation in focus in the session ahead
• The dollar long con
• Close but no cigar again for EUR/USD buyers

Markets:

• USD leads, NZD lags on the day
• European equities higher;
  S&P 500 futures down 0.07%
• US 10-year yields down 4 bps to
  3.741%
• Gold
  up 0.52% to $2,647
• WTI
  crude down 0.70% to $67.71
• Bitcoin
  up 0.69% to $63,747

We had a
relatively quiet session in terms of fresh data releases. The main highlight was the
Eurozone Flash CPI report, and the data came out in line with estimates. The
market has already fully priced in a back-to-back 25 bps cut in October and that’s
also something ECB members recently have been touting to.

In the
markets, the US Dollar added to the gains following Fed Chair Powell’s comments
yesterday with EUR/USD being the most notable mover. Another
notable mover this morning has been crude oil as it sold off to a new weekly
low before erasing almost the entire drop. There was no catalyst for the
move though.

The focus
will now switch to the US data in the American session with the US ISM Manufacturing
PMI being the main highlight. We will also get the Canadian PMI and the US Job
Openings data.

This article was written by Giuseppe Dellamotta at www.forexlive.com.