MNI EUROPEAN OPEN: Oil Pullback Continues

" EU (TIMES: les-tbzr2w5zs): "Andy Burnham hopes to clinch EU reset deal by end of the year. " EU (BBC: ): "Andy Burnham has warned that planned EU rules to help European manufacturers would damage the UK, as he met European Commission President Ursula von der Leyen. " POLITICS (BBC: ): "The UK will set up a new centre to "stem the poisonous tide" of hostile state attacks, including Russian disinformation, and lead efforts to establish global safety standards for artificial intelligence, Prime Minister Andy Burnham has said.

" POLITICS (BBC: ): "Trump said UK-US relations are "more up now" that Burnham is in power, following their meeting on the sidelines of the UN General Assembly. Speaking to reporters, Burnham said he had "established a good connection" with Trump and they had "taken that further today" following discussions on issues such as trade and immigration. But the US president made clear his opposition to the UK's "terrible" deal to hand over the Chagos Islands to Mauritius. " EU ECB (BBG: ): "The European Central Bank may have to raise interest rates to a level at which they hold back economic growth, according to Governing Council member Joachim Nagel.

" NATO (BBC: ): "The US, Denmark and Greenland have signed a defence deal that allows Washington to build two new military bases in the Arctic territory, while reaffirming Copenhagen's sovereignty over it. " UKRAINE (ECONOMIST: -0cceefa85e79): "Following a bilateral meeting with Donald Trump on Tuesday, Volodymyr Zelensky will address the UN General Assembly the next day. S.

" SWITZERLAND (MNI SNB WATCH: watch-1790091740222): The Swiss National Bank looks set to keep monetary policy unchanged on Thursday, holding the policy rate at 0%, but following on from hikes at leading G7 central banks in recent weeks, the likely upward revision of inflation forecasts could signal monetary policy tightening is approaching in Switzerland too. 75% on Thursday, though it is expected to raise its inflation forecasts given persistently high energy costs, and analysts anticipate an increase in its rate path to indicate a higher probability of a hike before year end than the 50% mentioned in June.

5% from January 2028, as well as a shift to eight policy meetings per year from 2027. S. monetary policy is in the range of neutral and the economy is solid without being overheated, Federal Reserve Bank of Richmond President Thomas Barkin told reporters Tuesday. A Richmond Fed estimate of r-star estimates the neutral rate to be in the "high 3s" with a large error band, Barkin said.

" FED (MNI BRIEF: turn-to-2percent-1790087915670): A Federal Reserve with monetary policy that is more restrictive will help to bring inflation back to target in a more timely manner, Boston Fed President Susan Collins said Tuesday. FED (MNI: eform-jefferson-1790087117500): Federal Reserve Governor Philip Jefferson Tuesday said the central bank's discount window remains ready to lend smoothly and effectively to banks when needed, but the Fed cannot be complacent in its modernization efforts of the lending facility.

FED (MNI: -evolves-williams-1790085900294): New York Fed President John Williams on Tuesday said it is imperative that as markets evolve over time, the central bank must ensure that policy tools are well suited to carry out necessary functions. " OTHER DEBT (BBC: ): "The world's advanced economies including the UK and US need to cut borrowing and reduce debt levels following weeks of spiralling government interest costs, the head of the International Monetary Fund (IMF) has warned. 40%. The operation led to a net drain of CNY102 billion after offsetting maturities of CNY110 billion, according to Wind Information.

3841% on Tuesday. * The CFETS-NEX money-market sentiment index, measuring interbank money-market liquidity, closed at 51 on Tuesday, compared with 50 on Monday. A higher reading points to tighter liquidity condition, with 50 representing an equilibrium. 7459 set on Tuesday.

6973 survey today. MARKET DATA AUSTRALIA S&P GLOBAL AUSTRALIA SEPT. 0 AUSTRALIA S&P GLOBAL AUSTRALIA SEPT. 2 AUSTRALIA S&P GLOBAL AUSTRALIA SEPT.

7 SOUTH KOREA SEPT. 7% SOUTH KOREA AUG. 4% SOUTH KOREA AUG. 2% SOUTH KOREA AUG.

9% MARKETS US TSYS: Oil Aids Higher 10yr Futures, But Still Short Of 20-day EMA Test: t-of-20-day-ema-test-1790139374653 US 10yr futures (TYZ6) have been biased higher so far in Wednesday trade. We were last 106-07+, +07+. 5% off mid Sep highs, amid increased supply hopes and on reported positive US/Iran talks (albeit via mediators and with little in the way of fresh details). TYZ6 hasn't been able to sustain +106-08 levels since mid Sep and broader levels continue to hold.

In terms of technical watch points, support below at 105-10+, the Oct 19 '23 low on the continuation chart. Initial firm resistance is 106-27, at the 20-day EMA. * There has been no cash UST trading so far today in Asia Pac, with Japan markets still out (they return tomorrow). 961% (up 1bps).

* Look ahead: Eurozone flash PMIs highlight the Wednesday calendar, as markets then turn their focus to headlines emanating from the Trump-Xi summit in Washington. Flash PMIs early in the US session, followed by Japan flash PMI. Australian employment data wraps up the midweek session. AUSSIE BONDS: 10yr Futures Challenge 20-day EMA Resistance, Jobs Data Tomorrow: e-jobs-data-tomorrow-1790138668769 Aussie bond futures are higher, led by the 3yr.

74. 80 (early Sep highs) into focus. 12). 875 from Sep 14.

UST futures have risen, TYZ6 last 106-07, +07 for the day. Oil futures continue to correct lower, now tracking down for the sixth straight session, which is aiding these futures moves. 5% off mid Sep highs). 5bps lower across the benchmarks, with the front end leading the move.

24%. 0% for now. RBA market pricing for next week's meeting remains close to 90%, while longer dated OIS levels have softened modestly today. * On the data front, Sep preliminary PMIs fell versus August reads, particularly for manufacturing.

However, looking at the quarter as a whole, Q3 services PMI was also higher than Q1 and Q4 signalling resilience. Cost growth rose to its highest for Q3 driven by services but importantly selling price inflation also increased implying increased cost pass through but both measures are below Q2's highs. The RBA will continue to watch second-round effects from higher fuel costs as it worries upside inflation risks are "materialising". 9% respectively.

The data are volatile and so 3-month averages are needed to gauge the trend. They have signalled a gradual easing in labour market conditions, which the RBA has welcomed in its fight to return inflation to target. BONDS: NZGBS: Yields Retrace With Oil, 10yr Nears 20-day EMA: -day-ema-1790137473558 NZGB yields have faltered as the Wednesday session unfolded. 5bps across the curve, with the front end leading.

90%. Whilst there is no cash US Tsy trading in Asia Pac today (with Japan markets still out), the bias in the region has been for higher bond futures, amidst further declines in oil futures (now tracking lower for the sixth straight amid US/Iran discussions (via mediators) and increased supply hopes). For the NZ 2yr this more than unwinds yesterday's rise and puts us back around levels that prevailed at the end of last week. * For the 10yr we are under end levels from last week and continue to unwind the mid Sep bounce.

885%. 75%, also unwinding yesterday's RBNZ induced rise. * The NZ-US 10yr spread is tracking lower, last -5bps, with Sep lows resting at -9bps. * RBNZ hike expectations for Oct have been trimmed modestly, last back to around 65%, after rising above 70% after hawkish RBNZ remarks yesterday.

* NZ rates markets will likely continue to take their cues from offshore/oil developments in light of no local data this week. 12%. The US Dollar is having another crack at challenging the pivotal 1205-1207 area. It failed at the second time of asking overnight but this price action continues to catch the eye as risk trades firmly on the front foot.

The US Dollar continues to lag and diverge from the rebound seen in the broader market. A sustained break back above the 1205-1207 area would have me thinking we could potentially see the USD turn higher again. Something I would have previously thought would have been a tough ask while US equities and broader risk continues to build on their rebound. While the market works through how it wants to proceed, I suspect we could continue to see a range of 1197-1207 play out.

17%. 1500 area, pretty telling price action. 1600 area pivotal for me. Can the US Dollar continue to ignore the surge in risk?

It needs to break higher for this move lower in the EUR to gain momentum from here. 1700 where you are wrong. The price action is now turning decidedly bearish and I suspect rallies are now likely to be faded short-term. 1600 area comes back into play.

20%. 3450 area. 3650 range. 3500 to now turn into resistance at the first time of asking.

* Data: France Sept. HCOB PMIs, Germany Sept. HCOB PMIs, Eurozone Sept. PMIs, UK S&P Global/CIPS Aug.

PMIs, US MBA Mortgage Applications, US S&P Global Sept. 16%.