Daily Report 1-Oct-2026
Oct 01,2026 
By admin A cooler inflation print trims Fed hike bets, but the dollar holds firm into jobs week
The Fed's preferred inflation gauge came in cooler than expected on the last day of the quarter, pulling October rate-hike odds below 40% and halting the climb in short-dated yields. Yet the 30-year yield sits at its highest since 2002, the dollar stays near cycle highs with the euro and the Aussie at fresh lows, and the Dow closed out a weak September as the clear laggard. Gold has steadied off its lows and oil keeps sliding; focus now moves to today's ISM manufacturing survey and Friday's September payrolls.
Market snapshot
| INSTRUMENT | LEVEL | BIAS | Note |
|---|---|---|---|
| FX MAJORS | |||
| EUR/USD | 1.13206 | Soft | Fresh lows; momentum near oversold |
| GBP/USD | 1.32519 | Neutral | Holding up better than the euro |
| USD/JPY | 158.216 | Firm | Back above 158, intervention zone |
| AUD/USD | 0.69460 | Soft | Deeply oversold near 0.6946 |
| COMMODITIES | |||
| Gold (XAU/USD) | 4,176.96 | Steadying | Bounced off the 4,130 low |
| Silver (XAG/USD) | 61.138 | Steadying | Holding above 60.5 |
| Crude oil (WTI) | 91.598 | Soft | Premium unwinding toward 91 |
| INDICES & CRYPTO | |||
| Dow Jones (US30) | 51,131.79 | Heavy | Down 4.3% in September |
| Bitcoin (BTC/USD) | 84,038.85 | Range | Trading as a risk asset |
Levels are indicative at the time of writing and can differ between spot and CFD quotes. Check live prices on your trading platform.
Top story: a cooler inflation print, but the dollar holds the line
The quarter ended with some relief on inflation. The Federal Reserve preferred gauge, core PCE, rose just 0.2% on the month and 3.4% over the year, both cooler than the 0.3% and 3.7% the market expected. That halted the climb in short-dated Treasury yields and pulled the market-implied odds of an October rate hike below 40%, down from around 55% a week earlier.
The inflation scare has eased, but the long end of the curve and a firm dollar say the market is not ready to call the all-clear.
Yet the reaction was not a clean risk-on. The 30-year yield held at its highest since 2002, above 5.6%, and the dollar stayed near cycle highs, leaving the euro and the Australian dollar at fresh lows and the yen back above 158. The Dow closed out a bruising September, down 4.3% on the month as the rate-sensitive, cyclical index lagged a technology-led Nasdaq that rose on the quarter. Quarter-end rebalancing added to the pressure.
Why it matters for traders
- Hike odds have dropped, but not the dollar's edge. The soft print trims near-term hike risk, yet markets still see further tightening into next year, so the greenback keeps its advantage until the data clearly turns.
- The long end is the problem. With the 30-year yield at a 2002 high, duration-sensitive and cyclical assets like the Dow stay pressured even as inflation data cools.
- Oil's slide is the quiet disinflation engine. Crude near 91 is a big reason the inflation data cooled. Whether it holds is central to the rates story.
- The data gauntlet is not over. The ISM manufacturing survey today and Friday's payrolls are the real tests after a quarter dominated by inflation and yields.
FX majors
The dollar is holding near cycle highs despite the cooler inflation print, supported by a long end of the curve that refuses to come down. Until the jobs data clearly softens, dips in the greenback are likely to be bought, though several crosses are stretched enough to bounce first.
EUR/USD
1.13206The euro has pressed to fresh lows and is the clearest expression of the firm dollar. Momentum is pushing into oversold, which raises the odds of a corrective bounce, but the trend is down while the rate gap stays wide. A soft ISM is the main upside risk today; a firm one opens the mid-1.12s.
GBP/USD
1.32519Sterling is holding up noticeably better than the euro, with momentum neutral rather than oversold. It is ranging around 1.325; a push through 1.3271 would ease the short-term pressure, while a loss of 1.3224 hands the initiative back to dollar bulls.
USD/JPY
158.216The pair has pushed back above 158, squarely in the zone where the risk of Japanese intervention rises. Momentum is firm, but moves are likely to stay orderly below 158.95. A fast run toward 159 raises the risk of verbal warnings from Tokyo, or of actual yen buying, which has historically taken several big figures off the pair within hours.
AUD/USD
0.69460The Aussie is deeply oversold, with momentum near the lowest readings of the cycle after a relentless slide. That sets up a two-sided risk: a dollar pullback or a soft ISM could spark a sharp short-covering bounce, while continued dollar strength would press it under 0.6930.
Commodities
Gold (XAU/USD)
4,176.96Gold has steadied, bouncing off its 4,130 low as the cooler inflation print halted the rise in yields and gave the metal room to recover. It remains below the recent highs and is consolidating rather than breaking out, with momentum back to neutral. A reclaim of 4,212 would signal the recovery has legs; a loss of 4,130 reopens the downside.
Crude oil (WTI)
91.598Crude has kept sliding toward 91 as the supply premium that dominated September continues to unwind on improving diplomacy and restored flows. The decline has been one of the main forces cooling inflation, but momentum is now near oversold, so the pace may slow. A break of 91 opens the 90 handle; only a recovery back above 93.24 would question the downtrend.
Silver (XAG/USD)
61.138Silver has stabilised above 60.5 and bounced with gold as yields paused. As a higher-beta metal it will amplify any move in the complex once the data lands, so the 60.5 shelf is the pivotal near-term floor: holding it keeps the bounce intact, losing it reopens the lows.
Indices & crypto
Dow Jones (US30)
51,131.79The Dow was the quarter's clear laggard, down 4.3% in September as the long end of the curve stayed elevated and the cyclical, rate-sensitive index underperformed a technology-led Nasdaq. It sits near its lows, with momentum soft but futures firming overnight after the cooler inflation data. A reclaim of 51,386 would ease the pressure; a loss of 51,000 exposes the next leg lower.
Bitcoin (BTC/USD)
84,038.85Bitcoin is holding in its range around 84,000, with momentum neutral. It continues to trade as a risk asset rather than a hedge, so its next directional move is likely to follow the broad risk tone set by the ISM survey today and the jobs report on Friday.
Economic calendar
| GMT | GST | Event | Impact | Consensus | Prior |
|---|---|---|---|---|---|
| 12:30 | 16:30 | US initial jobless claims | MED | – | – |
| 13:45 | 17:45 | S&P Global final US mfg PMI (Sep) | LOW | – | – |
| 14:00 | 18:00 | US ISM manufacturing PMI (Sep) | HIGH | – | 48.7 |
| 14:00 | 18:00 | US construction spending (Aug) | LOW | – | – |
| Aft. close | Late | Nike earnings | MED | – | – |
GST is Gulf Standard Time (GMT +4). Consensus figures are market estimates and may be revised before release. Dashes mean no widely published estimate at the time of writing. The prior ISM manufacturing reading was in contraction below 50.
What to watch: the Chicago business barometer jumped to 58.8 and private payrolls rose 90,000 on the ADP measure, so a firm ISM would revive the resilient-economy view, keep the long end bid and support the dollar. A soft ISM, or higher jobless claims, would reinforce the cooler-inflation story, ease yields and give the oversold euro and Aussie room to bounce. The real test is Friday's September payrolls.
Analyst view: three scenarios for the session
Base case ~50%
ISM lands around the expansion line and jobless claims hold steady. The long end stays elevated, the dollar consolidates near its highs, and gold ranges between 4,130 and 4,212. Markets mark time and keep their powder dry for Friday's payrolls, so range trading fits better than chasing breakouts.
Risk-on relief USD down ~25%
A soft ISM or higher jobless claims reinforce the cooler-inflation message. Yields ease further, the dollar pulls back, EUR/USD bounces off oversold toward 1.1353, the Aussie snaps higher, gold reclaims 4,212 and the Dow stabilises.
Dollar extends USD up ~25%
A strong ISM, following the Chicago jump, and low claims revive the resilient-economy view. The long end stays bid, the dollar presses EUR toward 1.1285 and AUD under 0.6930, and gold slips back toward 4,130.
Scenario weights are the desk's subjective assessment and are not forecasts or trade recommendations.
Risk notes
- Friday's jobs report is the main event. Today is a warm-up; size positions with Friday's payrolls in mind, as it can reset the whole rates picture.
- Yen intervention. USD/JPY above 158 is in the zone where Japanese authorities have acted before. Expect two-way risk and consider guaranteed stops.
- AUD is stretched. With momentum near its lowest of the cycle, a sharp short-covering bounce is a real risk on any dollar pullback.
- Oil headline risk. United States and Iran diplomacy and OPEC supply headlines can move crude several dollars quickly, with knock-on effects for yields.
- Quarter turn. Early October historically brings higher volatility, and fresh-quarter positioning can make price action choppy.