- As speculation that the Federal Reserve is reaching the conclusion of its tightening cycle intensified, stocks surged in Asia and the dollar dropped. Japan's Nikkei 225 Stock Average set a record 33-year high.
- The dollar fell against all of its Group-of-10 peers while an index of emerging-market currencies surged to the highest level since February. A measure of regional equities was headed for its highest close in two months after dovish remarks from Federal Reserve officials last week reinforced bets the central bank is done with interest-rate hikes.
- After Fed Vice Chair for Supervision Michael Barr said on Friday that officials are probably at or near the end of their tightening campaign, traders are currently pricing in a 30% probability of the first Fed rate cut in March. However, San Francisco Fed President Mary Daly stated policymakers are not certain inflation is on a path to their 2% target.
- Australian and New Zealand bonds also declined as Treasuries dipped ahead of a 20-year bond auction that will help determine whether investors are certain that the selloff in 2023 is finally over. The Treasury market is expected to post its first monthly returns in November, capping a six-month losing run.
- The offshore yuan strengthened after the PBoC boosted its daily reference rate for the currency to the strongest level since August. The nation’s commercial lenders on Monday kept their benchmark lending rates unchanged, in line with the central bank’s decision this month to maintain policy rates in favor of other means to support stimulus spending.
- Oil climbed as investors looked ahead to an OPEC+ meeting on supply that will shape market balances into 2024.
