Markets maintained their resilient tone on Wednesday despite the ongoing U.S. government shutdown entering its eighth day, with equities and alternative assets posting gains as traders digested Federal Reserve meeting minutes that revealed a divided committee but confirmed the path toward further easing.
The session was marked by contrasting signals: gold extended its historic rally past $4,000 per ounce, the S&P 500 climbed to fresh records above 6,750, and the dollar found support despite concerns about the prolonged budget impasse in Washington.
Check out the headlines and economic updates you may have missed in the latest trading session!
Headlines & Data:
- Japan Reuters Tankan Index for October 2025: 8.0 (15.0 forecast; 13.0 previous)
- Australia Building Permits Final for August 2025: -6.0% m/m (-6.0% m/m forecast; -8.2% m/m previous)
- Australia Private House Approvals Final for August 2025: -2.6% m/m (-2.6% m/m forecast; 1.1% m/m previous)
- New Zealand RBNZ Interest Rate Decision for October 8, 2025: 2.5% (2.5% forecast; 3.0% previous)
- Japan Eco Watchers Survey Outlook for September 2025: 48.5 (47.9 forecast; 47.5 previous)
- Germany Industrial Production for August 2025: -4.3% m/m (-0.8% m/m forecast; 1.3% m/m previous)
- MBA 30-Year U.S. Mortgage Rate for October 3, 2025: 6.43% (6.46% previous)
- Mortgage Applications for October 3, 2025: -4.7% (-12.7% previous)
- U.S. EIA Crude Oil Stocks Change for October 3, 2025: 3.72M (1.79M previous)
- The Federal Open Market Committee minutes from the September 16-17, 2025 meeting revealed a divided Fed with most officials supporting the recent 25-basis-point rate cut while expressing caution over persistent inflation risks and softening labor market conditions, projecting two additional quarter-point cuts by year-end.
- The U.S. government shutdown entered its eighth day, with more than 250,000 federal employees missing scheduled paychecks this week and economic consequences mounting.
Broad Market Price Action:
Dollar Index, Gold, S&P 500, Oil, U.S. 10-yr Yield, Bitcoin Overlay Chart by TradingView
Risk sentiment remained constructive on Wednesday as markets demonstrated remarkable resilience to multiple headwinds, with traders focusing on the prospect of additional Fed rate cuts rather than concerns about the government shutdown or political turmoil abroad.
The S&P 500 extended its advance, gaining 0.57% to close at fresh all-time highs above 6,750. The rally was powered by renewed dip buying and momentum-chasing traders who continued piling into equities after a series of records, with enthusiasm around artificial intelligence trumping concerns about bubble formation in high-profile tech names. The index showed steady gains throughout the session, with particular strength following the FOMC minutes release.
Gold continued its extraordinary run, surging 1.47% to trade above $4,035 per ounce, establishing yet another record high. The precious metal surpassed $4,000 a troy ounce for the first time on Tuesday, driven by safe-haven demand amid concerns about a weakened dollar and President Trump’s tariff policies. Goldman Sachs raised its December 2026 gold price forecast to $4,900 an ounce from $4,300 previously, citing ETF inflows and central bank buying.
WTI crude oil posted a modest gain of 0.81%, recovering to trade around $63.80 after recent weakness. The gain came despite a larger-than-expected build in U.S. crude inventories, with the EIA reporting stocks rose 3.72 million barrels versus 1.79 million in the prior week.
Bitcoin demonstrated strength, climbing 1.33% to trade above $123,600. The cryptocurrency continues to benefit from its emerging role as an alternative asset amid traditional market volatility, with many experts calling the move into both gold and cryptocurrencies the “debasement trade.”
The 10-year Treasury yield edged marginally higher by 0.10% to settle around 4.16%, showing relative stability despite the ongoing data blackout from the government shutdown and ahead of key Fed speeches scheduled for Thursday.
FX Market Behavior: U.S. Dollar vs. Majors:
Overlay of USD vs. Majors Chart by TradingView
The U.S. dollar displayed measured strength on Wednesday, posting net gains against most major currencies through a session characterized by divergent regional monetary policy developments and political concerns in Europe and Japan.
The greenback opened the Asian session with solid momentum, building on positioning flows as traders continued to assess implications of political developments in Japan and France. The yen remained under pressure following Sanae Takaichi’s victory in Japan’s ruling party leadership election, with markets anticipating looser fiscal and monetary policy. The dollar climbed to a fresh seven-month high against the yen, with USD/JPY finishing 0.51% higher around 152.67.
During the London morning session, the dollar experienced a modest pullback as European markets opened and traders adjusted positions. However, the retreat proved temporary and shallow, with the DXY index finding support above the 98.00 level.
The U.S. session brought renewed dollar strength in early trading, with the greenback advancing broadly, potentially a reaction to news that the EU sees new U.S. demands for concessions as potentially undercutting the recent trade agreement that brought the allies back from the brink of a trade war.
The afternoon release of FOMC minutes triggered brief volatility. The minutes showed that only one participant supported a half-point cut at the September meeting, while “a few” participants saw merit in keeping rates steady, suggesting alternative opinions on the committee leaned in a more hawkish direction than the decision. The dollar pulled back modestly following the release as markets confirmed expectations for continued gradual easing.
By day’s end, the dollar closed higher against most majors, with particularly strong performance versus the yen and Swiss franc.
Upcoming Potential Catalysts on the Economic Calendar
- U.K. RICS House Price Balance for September 2025 at 11:01 pm GMT
- Australia Consumer Inflation Expectations for October 2025 at 12:00 am GMT
- Germany Balance of Trade for August 2025 at 6:00 am GMT
- Japan Machine Tool Orders for September 2025 at 6:00 am GMT
- Euro area ECB Monetary Policy Meeting Accounts at 11:30 am GMT
- Canada BoC Rogers Speech at 12:15 pm GMT
- U.S. Fed Chair Powell Speech at 12:30 pm GMT
- U.S. Initial Jobless Claims for October 4, 2025 & September 27, 2025 (tentative)
- U.S. Fed Bowman Speech at 12:35 pm GMT
- U.S. Wholesale Inventories for August 2025 (tentative)
- Euro area ECB Lane Speech at 3:00 pm GMT
- U.S. Fed Barr Speech at 4:45 pm GMT
- U.S. Fed Bowman Speech at 7:45 pm GMT
- U.S. Fed Balance Sheet for October 8, 2025 at 8:30 pm GMT
Thursday’s calendar features another slate of central bank communication that could drive significant market volatility. Fed Chair Powell’s speech at 12:30 pm GMT will be closely scrutinized for any signals about the pace of rate cuts following Wednesday’s FOMC minutes, which revealed divisions within the committee. Governor Miran has indicated his forecast for inflation is more optimistic than some colleagues, viewing the Fed’s dual mandate as “less in tension” than others do, though he dissented in favor of a larger cut at the last meeting.
The ongoing government shutdown, now in its eighth day, continues to create uncertainty around economic data releases, with jobless claims marked as tentative on the calendar. Any updates on budget negotiations in Washington could trigger sharp moves across asset classes, particularly if there are signs of progress toward resolution or, conversely, indications the impasse may extend further.
The shutdown has already caused more than 250,000 federal employees to miss paychecks, with another two million set to go without pay if the impasse extends into a third week. Markets will also monitor whether delayed economic reports, including the crucial September payrolls data, receive any clarity on release timing.
Stay frosty out there forex friends and don’t forget to check out our Forex Correlation Calculator when taking any trades!
