The World, Briefly.

Warsh keeps his cards close: "I don't prejudge meetings"

Speaking with IMF Managing Director Kristalina Georgieva in Bangkok, Warsh said the economy has "broadly conformed" to the Fed's expectations since September's rate hike, the first since 2023, and declined to preview October. He called AI "probably the most consequential change" to the global economy in his lifetime, while warning the transition is likely to be "very bumpy".

Markets had swung hard on the week's data: CME FedWatch odds of an October hike jumped from 22% to 50% after Wednesday's hot CPI report, then eased back to around 28% by Thursday afternoon.

WatchThe 27–28 October Fed decision. NY Fed President John Williams said this week one more hike this year is appropriate.

Yields bounce off a three-week low

Treasuries rallied on Thursday as AI stocks wobbled: the 10-year yield settled at 5.09% after touching about 5.04%, a three-week low. It turned higher again on Friday, back near 5.1%, with the long end rising faster than the short end. Earlier this month the 10-year reached 5.35%, its highest since 2002. In Europe, German 10-year Bund yields hit a five-week low near 3.35%.

WatchWhether rising long-term yields keep pressure on richly valued tech stocks.

Oil heads for a second weekly gain

Brent traded near $106 a barrel and WTI near $96, on course for a second weekly rise as Middle East supply risk outweighed emergency stock releases. Gold held near $4,196 an ounce.

Houthi strike hits Yemen's presidential palace in Aden

At least four people were killed and ten wounded when Houthi strikes hit Al-Maashiq Palace in Aden, headquarters of Yemen's internationally recognised government, according to three government military sources cited by AFP. Houthi-affiliated media said the group struck a "headquarters of military operations".

The Saudi-led coalition says the Houthis have launched 20 attacks on Riyadh's King Khalid International Airport this month, and it released footage of attacks on the Abha, Najran and Jazan airports. The Gulf Cooperation Council postponed the EU-GCC summit that was set for 24 October in Riyadh, citing the attacks.

WatchWhether Saudi airports reopen, and any mediation between Riyadh and the Houthis.

Hormuz: Tehran says closed, Washington says open

Iran's army chief, Maj. Gen. Amir Hatami, said the strait stays closed "until the enemy respects the rights of the Iranian people". US Central Command says commercial traffic continues, with more than 19 million barrels of crude moved through the strait in a single day.

The US Treasury added sanctions on Iran-linked financial networks, including an Iraqi bank, and FinCEN issued an alert on the abuse of religious charity networks, both under its "Operation Economic Outcast" campaign.

IMF sees 4.5% growth, but aid is shrinking

The IMF projects African growth of 4.5% in 2026 and 5% in 2027, while development assistance is expected to fall about 12% this year after a sharp drop in 2025. Nigeria's inflation, published Thursday, eased to 14.63% in September from 15.39%.

A separate risk is building: Gulf fertilizer shipments have been largely halted for more than six months, and a UN official warns that failing to agree a plan to move fertilizer through Hormuz within weeks could trigger a food security crisis in parts of Africa and Asia.

WatchDangote refinery's share offer, reportedly opened to qualified Ethiopian investors, closes on 27 October.

No deal on the EU's next €2 trillion budget

EU leaders largely rejected the Irish presidency's proposal to cut €141 billion from the 2028–2034 budget, and Council President António Costa now takes over the negotiations, with a new proposal expected within weeks and a special summit on 26 November. Several leaders openly doubted a deal before year-end. Germany's DAX rose almost 1% on Friday.

A relief rally after Asia's chip rout

The KOSPI rose 2.1% and the Nikkei 1.4%, while Hong Kong's Hang Seng added 0.5% and Taiwan 0.3% after Thursday's 3.4% drop. Australia's ASX gained 1%, though the Australian dollar touched its lowest level since early July.

WatchWhether the rebound in memory-chip makers holds, after the KOSPI lost more than 16% in a month.

The rotation out of AI

Healthcare, financials and materials led Thursday's gains while AI names lagged, a pattern the "Why it matters" note above explains. US retail sales rose 0.8% in September, above the 0.3% forecast, and weekly jobless claims stayed low at 199,000. Canada's TSX rose 1.6%.

Brazil's markets wobble before the runoff

The Ibovespa fell 1.1% to about 204,300, its third straight loss, and the real weakened, nine days before the 25 October runoff between President Lula and Flávio Bolsonaro. The last Datafolha poll had Flávio at 49% and Lula at 45%, within the margin of error. Mexico's IPC rose 1.3% and Argentina's Merval 0.8%.

TSMC's record quarter didn't stop the selling

TSMC reported third-quarter revenue of US$46.7 billion, up 41% in dollar terms, with net income up 68.7% and a gross margin of 66.4%. It guided fourth-quarter revenue to US$52.3–54.3 billion. The shares still fell 1.8% in Taipei, a sign that this week's chip selloff was about rates and positioning more than demand.