US Treasury yields surged after US Federal Reserve Chair Jerome Powell said a December rate cut was not to be counted on despite a reduction in the benchmark rate to 3.75% to 4%. Powell's comments led traders to revise expectations for future rate cuts, causing a significant sell-off in the bond market. The Fed also announced the end of its balance sheet reduction program, further influencing market dynamics.

The Bank of Japan opted to maintain its benchmark interest rate at its latest meeting, a move widely anticipated by economists. Despite two board members, Naoki Tamura and Hajime Takata, dissenting for a second straight session, the central bank signaled a cautious approach to policy normalization. The yen weakened as much as 0.3% against the dollar, dropping to 153.14.

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US President Donald Trump and Chinese President Xi Jinping have reached a one-year trade agreement that includes the postponement of Chinese export controls on rare earths and a reduction in US tariffs on fentanyl-related products. The deal, announced after a summit in South Korea, aims to stabilize trade relations and includes discussions on semiconductors.

Global bond markets have rebounded in October, with UK, German and Japanese yields experiencing significant drops amid easing concerns about inflation and government borrowing. UK gilts have led the rally, with 10- and 30-year yields falling about 30 basis points. However, analysts remain cautious because high debt levels and potential political instability in France and the UK could pose risks.

The US and South Korea have reached terms on a trade agreement that includes $350 billion in South Korean investments in the US and a reduction in US tariffs on South Korean goods from 25% to 15%. The deal, announced after a meeting between US President Donald Trump and South Korean President Lee Jae Myung, also involves significant energy purchases by South Korea and cooperation in shipbuilding.

Bipartisan negotiations to end the 29-day US federal government shutdown are showing signs of renewed momentum, with US Senate Majority Leader John Thune indicating he expects to engage with Senate Democrats soon. While formal leadership-level talks between Thune and Senate Minority Leader Chuck Schumer have not occurred, informal discussions among rank-and-file members are intensifying as critical deadlines approach, including the looming cutoff of federal food aid.

The US Federal Reserve announced it will end its balance sheet runoff on December 1, shifting from reducing its US Treasury holdings to maintaining their current level by rolling over maturing securities. This marks an earlier-than-expected conclusion to quantitative tightening, as the Fed has observed signs of tightening liquidity and declining reserve levels in money markets.

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