Guardian Weekly Market Report – Issue 189

Reports of Note Due This Week

The upcoming week is packed with U.S. macro‑releases that will set the tone for metals markets. Inflation data dominates mid‑week: the September Consumer Price Index (CPI) and the Producer Price Index (PPI) are due, while September retail sales and the Philadelphia Fed survey will offer a read on consumer demand and manufacturing activity. Housing starts, building permits and industrial production round out the week, providing fresh insight into the pace of U.S. economic growth. Traders will look for clues about whether the Federal Reserve’s rate‑cut path remains on track.

• Monday – Columbus Day. No major U.S. data releases
• Tuesday – No major U.S. releases (Canada building permits are due at 08:30; U.K. unemployment at 02:00
• Wednesday – U.S. Empire State Manufacturing Index (Oct) and CPI (Sep), Federal Reserve Beige Book (summary of current economic conditions)
  
• Thursday – U.S. Retail Sales (Sep), Producer Price Index (Sep), and Philadelphia Fed Manufacturing Index (Oct), U.S. Business Inventories (Aug)
  
• Friday – U.S. Housing Starts & Building Permits (Sep); Import/Export Price Indices (Sep), U.S. Industrial Production & Capacity Utilization (Sep), U.S. Treasury International Capital / Foreign Portfolio Flows (Aug)

Geopolitics

President Trump capped a whirlwind Middle East trip by addressing Israel’s Knesset and co-signing a Gaza peace plan in Egypt with Qatar, Egypt, and Turkey. All 20 surviving Israeli hostages were freed; however, only 4 of the 28 expected bodies were returned, prompting outrage and claims of a Hamas breach. In exchange, Israel began releasing 250 prisoners serving life sentences plus more than 1,700 Gazans detained since 2023, with many deported to Egypt. Biden praised Trump’s role; the Red Cross facilitated transfers, and the U.N. moved to scale up aid as talk turned to Gaza’s reconstruction. World leaders gathered in Sharm el-Sheikh, though Netanyahu skipped the summit after lauding Trump as Israel’s “greatest friend.” Trump said the war is “over,” while Netanyahu warned “the campaign is not over,” underscoring uncertainty around enforcing demilitarization, governance of Gaza, and completion of all remains transfers.

China warned it will not yield to U.S. pressure after President Donald Trump threatened 100% tariffs on Chinese imports in response to Beijing’s new restrictions on rare earth exports. In its first official statement on the issue, China’s Commerce Ministry said it does not seek a tariff war but “is not afraid of one,” urging Washington to resolve disputes through dialogue rather than threats. The escalating tension risks derailing a planned Trump-Xi summit and ending a fragile trade truce that briefly saw tariffs from both nations exceed 100% in April. Beijing criticized Washington’s approach, saying repeated tariff threats are “not the correct way” to manage relations, and warned it will take “resolute” countermeasures if the U.S. proceeds. Trump also threatened export controls on unspecified “critical software.” Both sides accuse the other of breaking the spirit of their trade ceasefire by imposing new trade restrictions.

Afghanistan claimed Sunday that its forces killed 58 Pakistani soldiers and seized 25 border posts in retaliatory overnight operations, following what it called repeated violations of its territory and airspace by Pakistan. Kabul accused Islamabad earlier in the week of bombing Kabul and an eastern market, though Pakistan has not confirmed responsibility. The Taliban warned it would respond strongly to future incursions, while Pakistan’s Prime Minister Shehbaz Sharif said his army destroyed several Afghan posts in response. Heavy clashes erupted along the border in Khyber Pakhtunkhwa, with both sides using heavy weaponry. The Torkham trade crossing remained closed amid the tensions. Pakistan accuses Afghanistan of sheltering Tehreek-i-Taliban Pakistan militants, a charge Kabul denies. Qatar and Saudi Arabia urged restraint and dialogue, with Riyadh’s response notable following its new mutual defense pact with Pakistan. The 1,622-mile Durand Line border remains a longstanding source of dispute.