October 1st, London Update: Global Markets and Geopolitical Briefing

The Financial Source Podcast

Show notes — Oct 1, 2025 (FX, Commodities, Trade, Geopolitics)

FX & central banks

• USD softened as the U.S. government shutdown begins; EUR and GBP edged higher ahead of Eurozone flash HICP; USD/JPY slipped below 148 after a mixed BoJ Tankan that didn’t force further hawkish repricing.
• RBA held rates with a mildly hawkish tone on inflation risks; AUD’s intraday support limited by softer local manufacturing data and China’s Golden Week closure.
• U.S.–South Korea issued a joint FX-policy statement: no exchange-rate manipulation, interventions reserved for disorderly markets, and monthly sharing of intervention data.

Commodities

• OPEC Secretariat rejected reports of a 500k bpd output increase by a subset of members; says ministers haven’t begun weekend meeting consultations.
• Gold printed another all-time high near USD 3,875/oz before easing on profit-taking; copper held above USD 10k/t with thin liquidity while China is shut.
• U.S. private inventories: crude draw, gasoline and distillate builds; separate reports flagged a fire at Glencore’s Lomas Bayas copper mine in Chile.

Trade & tariffs

• White House detailed new measures on wood products: 10% tariff on softwood/timber/lumber effective Oct 14; EU/Japan wood categories capped at 15% within trade deals.
• Cabinet/furniture actions: 25% tariffs on vanities and kitchen cabinets begin Oct 14; cabinet tariffs to 50% and selected upholstered furniture to 30% on Jan 1 unless agreements are reached.
• Pharmaceutical push: administration tying lower prices and U.S. production to tariff/regulatory incentives (e.g., priority reviews); officials reiterated MFN-style pricing aims.
• EU trade chief said post-2026 steel safeguards using tariff-rate quotas are coming “very soon.”
• Taiwan reportedly rejected a U.S. request to produce half of its chips domestically in the U.S.; Japan said a large U.S-bound investment program will be managed to avoid FX disruption.

Geopolitics

• U.S. government shutdown confirmed after the Senate rejected the House CR; agencies executing contingency plans. Data risks include likely delays to Jobless Claims and NFP if the shutdown persists.
• Russia–Ukraine: fresh waves of missiles and drones; Kyiv flagged a critical power-supply situation at the Zaporizhzhia nuclear plant; IAEA engaging both sides to restore off-site power.
• Middle East: continued diplomacy around a U.S. ceasefire framework for Gaza; Yemen’s Houthis claimed a cruise-missile strike on a Dutch-flagged vessel.

Policy commentary relevant to FX

• Fed speakers highlighted a cautious approach to cuts, noted that policy remains only modestly restrictive, and flagged tariff-related inflation risks—keeping focus on labor-market slack and near-term data.

What to watch next

• Eurozone & U.K. final manufacturing PMIs; Eurozone flash HICP.
• U.S. ADP and ISM manufacturing; Atlanta Fed GDP estimate.
• ECB and Fed speakers; BoC minutes.
• OPEC+ headlines ahead of the weekend meeting.
• Duration of the U.S. shutdown and any impact on this week’s U.S. data publication schedule.