September 22nd, London Update: Global Markets and Geopolitical Briefing

The Financial Source Podcast

Show Notes — Current Market & News Briefing (FX, Commodities, Trade & Geopolitics) — 22 Sep 2025

FX & Central Banks

• USD: DXY held in a 97.70–97.825 range ahead of this week’s U.S. PCE and a heavy slate of Fed speakers.
• EUR: EUR/USD hovered around Friday’s lows at 1.1728; ECB’s Šimkus said a December rate cut is needed to safely reach 2% inflation.
• GBP: GBP/USD steady above 1.3450; focus on speeches from BoE’s Pill and Bailey ahead of U.K. Flash PMIs.
• JPY: USD/JPY moved further into the 148.00 area; domestic attention on the LDP leadership race, with an FNN poll showing Takaichi at 28.3%.
• AUD: Subdued overall; limited reaction to RBA Governor Bullock’s balanced remarks noting uncertainty and conditional scope for rate adjustments.
• CNY: PBoC set the USD/CNY midpoint at 7.1106 (vs 7.1159 expected); 1-yr and 5-yr LPRs unchanged at 3.00% and 3.50%. Liquidity: CNY 240.5bln via 7-day reverse repos at 1.40% and CNY 300bln via 14-day reverse repo (first in eight months).
• Fed speakers: Governor Miran said disinflationary forces are in play, policy is restrictive, and “we are in an easing cycle”; Daly said the job market has softened quite a bit over the last year.
• U.S. government funding: Lawmakers face a Sept 30 deadline to avoid a shutdown; Senate back Sept 29, House Oct 7.

Commodities

• Crude oil: Firmer on weekend geopolitics. Estonia triggered NATO Article 4 after Russian MiG-31 incursions; Germany scrambled jets over the Baltic. The U.S. President suggested Europe will not be allowed to buy Russian oil much longer.
• Supply: Iraq’s oil marketer said exports increased after a gradual end to voluntary OPEC+ cuts. Baker Hughes rig count: Oil +2 (418), Natgas unch (118), Total +3 (542).
• Weather: NHC flagged a new tropical storm south of Mexico, expected to remain offshore and intensify.
• Gold: Held a mild bid just under USD 3,700/oz ahead of PMIs, Fed speakers, and U.S. PCE.
• Copper/Metals: Copper traded range-bound; Codelco said its biggest mine will take longer to return to full production after July’s tunnel collapse. China pledged tighter steel capacity controls and a ban on new capacity.

Geopolitics

• Baltic/NATO: Estonia requested Article 4 consultations after a 12-minute airspace incursion by three Russian MiG-31s near Vaindloo Island. NATO’s North Atlantic Council will convene early this week; the UNSC will also meet at Estonia’s request.
• Russia–Ukraine: EU’s 19th sanctions package to ban Russian LNG imports, add 118 shadow-fleet vessels (total now 560+), and impose full transaction bans on Rosneft and Gazpromneft. Reports of Ukrainian drones striking oil pumping stations tied to exports via Novorossiysk; Russia reported a Ukrainian drone attack in Crimea killing two and injuring 15.
• Middle East: An Israeli official said full or partial West Bank annexation is being considered following the U.K.’s recognition of Palestinian statehood. The U.S. plans USD 6bln in new arms sales to Israel (USD 3.8bln for 30 AH-64 Apaches; USD 1.9bln for 3,250 infantry assault vehicles). The U.K., Canada, Portugal, and Australia recognized Palestine; Israel “categorically rejects” unilateral recognition. Israel reported killing a Hezbollah member in southern Lebanon and acknowledged civilian casualties.
• Korean Peninsula: South Korea’s president called Russia–North Korea military cooperation a significant threat; North Korea said denuclearisation is no longer valid and ruled out talks with the U.S. under current conditions.
• Turkey–U.S.: The U.S. President will host President Erdoğan on Sept 25 to discuss trade and defense deals (Boeing purchases; F-16 and F-35 discussions).
• U.S. maritime: The U.S. reported a lethal kinetic strike on a narcotics-trafficking vessel in international waters; three killed, no U.S. casualties.

Trade & Tariffs

• U.S.–China: A U.S. House delegation made a rare visit to China (first since 2019) to stabilize ties. The U.S. President said “we made progress with China on several important issues” and that TikTok would not be allowed to face harm; China’s Commerce Ministry called for a fair, non-discriminatory environment for Chinese firms operating in the U.S.
• Taiwan linkage: Reports said the U.S. withheld >USD 400mln in military aid to Taiwan this summer while seeking a trade deal and a possible summit with China’s leadership.
• Visas: Plan to raise H-1B visa fees to USD 100k; an aide said a proclamation will implement it, with officials noting firms would pay USD 100k per year for H-1Bs.
• EU data policy: The EU is reportedly set to block big tech from a new financial data-sharing system.

Week-Ahead Watchlist (G7-relevant)

• U.S.: PCE (Fri); numerous Fed speakers across the week.
• U.K./Eurozone: Flash PMIs (Tue); BoE speeches today; ECB commentary ongoing.
• Japan: Domestic politics in focus alongside JPY levels; broader attention on upcoming inflation reads and policy signaling.
• China (policy-to-FX context): LPRs unchanged, larger liquidity injections; USD/CNY midpoint at 7.1106.