This update was written automatically with AI from market data and news wire reports, and published without review by a person.
Key Takeaways
- Bank of Canada (BoC) Governor Tiff Macklem warned that the neutral interest rate estimate may rise, following a 25-basis point hike to 2.50% to combat persistent inflation.
- President Donald Trump issued a proclamation identifying imported robotics and industrial machinery as national security risks, initiating a 180-day negotiation period with trading partners.
- Keppel (BN4) reported a strong 18% year-on-year growth in asset management fees for 9M 2026, reaching S$354 million as it accelerates its asset-light strategy.
- The Hong Kong Monetary Authority (HKMA) maintained its base rate at 4.25%, mirroring the U.S. Federal Reserve's decision to hold rates steady.
- Japanese investors shifted back to domestic markets, selling ¥92.6 billion in foreign bonds while foreign investors poured ¥1.18 trillion into Japanese equities.
Central Bank Policy and Inflationary Pressures
Bank of Canada Governor Tiff Macklem delivered a hawkish tone following the central bank's decision to raise the policy rate to 2.50%. Macklem noted that the neutral interest rate—the level at which policy is neither stimulative nor restrictive—may be higher than previously estimated. He emphasized that current inflation forecasts are heavily influenced by the pass-through of fuel costs, and warned that U.S. fiscal policy is currently unsustainable, citing a lack of political will to address deficit spending.
In Asia, the Hong Kong Monetary Authority (HKMA) kept its base rate unchanged at 4.25%. This move follows the city's established Linked Exchange Rate System, which necessitates tracking the U.S. Federal Reserve’s monetary policy to maintain the currency peg. While the base rate remained steady, local lenders have kept prime rates around 5.00% to 5.25%, reflecting a cautious approach to domestic borrowing costs.
Trade Policy and National Security
President Donald Trump has officially designated imports of robotics, industrial machinery, and their components as a threat to U.S. national security under Section 232 of the Trade Expansion Act. While the White House did not impose immediate tariffs, the administration has directed the U.S. Trade Representative (USTR) to enter negotiations with foreign partners. If agreements to "adjust" import levels are not reached within 180 days, the administration may move forward with tariffs, quotas, or fees to protect the domestic industrial base.
Corporate Performance and Asset Management
Keppel (BN4) continues to see success in its transition toward a global asset manager model. The company added S$19.5 billion in new funds under management (FUM) year-to-date in 2026, with total asset management fees rising 18% to S$354 million for the first nine months. Keppel also confirmed it has realized approximately S$940 million in asset monetisation this year, keeping it on track for its long-term goal of reaching S$10–S$12 billion in divestments by the end of 2026.
Regional Economic Indicators and Capital Flows
In New Zealand, the ANZ Business Confidence Index showed a slight improvement to 52.5 in October, up from 51.9 in September. However, the Activity Outlook softened to 46.2, down from 47.9, suggesting that while general sentiment remains optimistic, firms are becoming more cautious about their own growth prospects. Economists note that manufacturing remains a bright spot, while the agricultural sector continues to face headwinds.
Japan's latest security flow data for the week ending October 23 reveals a significant rotation in capital. Foreign investors became aggressive buyers of Japanese stocks, with net purchases totaling ¥1.18 trillion, a sharp reversal from the previous week's selling. Conversely, Japanese investors continued to retreat from international debt markets, selling ¥92.6 billion in foreign bonds as rising yields at home make domestic government bonds increasingly attractive.
Automated market updates written with AI from market data and news wire reports, published without human review.