Bank of Korea Nominee Shin Hyun-song Calls for Flexible Monetary Policy Amid Iran War Risks 
RBI Holds Interest Rates Steady Amid Middle East Tensions and Global Uncertainty 
Bank of Japan Warns of Regional Economic Risks Amid Middle East Conflict and Rising Oil Prices 
Federal Reserve Probes Big Banks Over Private Credit Exposure Amid Growing Systemic Risk Concerns 
RBI Clamps Down on Rupee NDF Activity, Banks Face Steeper Losses 
Bank of America Maintains Forecast for Two Fed Rate Cuts in 2026 Despite Inflation Risks 
Bank of Japan's Ueda Flags Low Real Interest Rates as Key Factor in Rate Hike Timing 
Citigroup Delays Fed Rate Cut Forecast Amid Strong Jobs Data and Inflation Concerns 
In China, data for FX reserves added to signs that the Chinese business cycle is bottoming. FX reserves fell by USD43.3bn, which was less than expected and a much smaller decline than in August, when reserves fell a record USD93.9bn. The valuation effects are limited as the currency movements have been small in September. Hence, intervention has been much smaller in September and the same goes for capital outflows.
Last week, the official Chinese manufacturing PMI showed signs of stabilisation and this, in combination with declining capital outflows, is underpinning risk appetite.
"We believe the positive sentiment in emerging markets can continue in the short run with positive spillover to Western markets too", says Danske Bank.
