RBA inline – Iran stalemate continues

Asia market update: RBA inline; Iran stalemate continues; >1K ex-dividends weigh on JP equities; 40-yr JGB auction meets higher demand, upcoming 2-yr sale could be a bigger test amid quarter-end; AI-governance concerns linger; CN PMIs due on Wed; Waller to speak on Tues.

General trend and developments

- The RBA raised its cash rate target by +25bps to 4.65%, marking the fourth hike in the current tightening cycle following three consecutive pauses. The decision was unanimous, with the Board citing persistently high inflation and judging that further tightening in financial conditions is warranted, while noting that due to the three increases in the cash rate since the beginning of the year, the economy appears to be slowing. The RBA reiterated that it remains prepared to raise rates further if needed to return inflation sustainably to target. (**Note: The RBA has an inflation target range of between 2.0-3.0%.).

- NZ cuts debt issuance forecasts: Beyond 2026/27, the fiscal outlook strengthens steadily as GDP growth remains around 2.4%-3.0%, CPI inflation returns to around 2.0%, and unemployment declines to 4.3% by 2030/31. Additionally, revenue continues to increase as a share of GDP, expenditure declines as a share of GDP, and Crown entity deficits improve, according to the Treasury. New Zealand Pre-Election Economic Forecasts come ahead of the New Zealand general election on November 7th, with official results scheduled to be declared on November 27th.

- Iran: Oil prices edge higher amid continued Iran-related uncertainty, with WTI crude futures opening +0.2% at $93.53/bbl (vs. $93.32/bbl prior). Most recently, US President Trump denied that he offered certain sanctions relief to Iran. Iran’s Foreign Minister is seeking a response to his country’s proposal from the US on Tues amid the continuing talks through mediators. Even still, Iranian officials are said to doubt than an agreement can be reached before the Nov US midterm elections.

- TECH: OpenAI is reportedly continuing to slow development pre-Trump AI CEO meeting on Tues [12:30 pm], as the co. discards plans to release new AI model GPT-6.1 Astra and continues to deal with headaches from Australia’s government in a commitment for a $1B daybreak fund. Attendees of the meeting include Nvidia’s CEO. In the NY session, the firm elected to reward shareholders by raising its stock buyback by $150B. Additionally, Anthropic reported significantly lower FY25 Net and Op results y/y, whilst laying out plans for transformative AI technology in marketing pitch for IPO investors.

- Backlash to Aussie data center projects grows despite prior positive impact on GDP; Goodman Group is speculated to have been forced to cancel a A$1.2B data center project in Sydney. Victoria has also banned data centers from residential areas. Meanwhile, both New South Wales and the Commonwealth are proposing reforms around data center grid connections and energy use, according to NEXTDC. The national framework is recommendations only, with changes phasing in from 2027.

- Looking ahead for the rest of this week (Asian-weighted focus, EST/EDT), key data releases include the CN September Government & RatingDog Mnfg/Svcs/Composite PMI on Tuesday September 29th, JP BoJ September Summary of Opinions followed by the JP Q3 Tankan Index on Wednesday September 30th, and JP September Tokyo CPI & Core CPI on Thursday October 1st. Markets will be closed for holidays in China & Hong Kong on Thursday October 1st, and China & India on Friday October 2nd.

- US equity FUTs -0.4% to -0.3% during Asia trading.

Looking ahead (Asian-weighted focus, using EST/EDT time-zone)

- Monday September 28th: IN Aug Industrial Production, MX Aug Trade Balance, (Mon night, AU RBA Interest Rate Decision & Statement, JP July Leading Index & Coincident Indicator).

- Tuesday September 29th: EU Sept Economic Confidence, CA July GDP, US Sept CB Consumer Confidence, US Aug JOLTS Job Openings, (Tue night, KR Aug Industrial Production & Retail Sales, JP Aug Industrial Production & Retail Sales, AU Aug Building Approvals, CN Sept Government & RatingDog Mnfg/Svcs/Composite PMI, JP Aug Housing Starts & Construction Orders, UK Q2 GDP).

- Wednesday September 30th: IN Q4 Trade Balance, US Q2 GDP, US Aug PCE & Aug Core PCE, RU Aug GDP & Retail Sales & Unemployment Rate, CO BanRep Sept Interest Rate Decision, (Wed night, Global Asia Sept S&P/HCOB Mnfg PMIs Day, JP BoJ Sept Summary of Opinions, JP Q3 Tankan Index, KR Sept Prelim Trade Balance, AU Aug Trade Balance & RBA Financial Stability Review, ID Aug Trade Balance).

- Thursday October 1st: Global Europe Sept S&P/HCOB Mnfg PMIs Day, EU Aug Unemployment Rate, US Sept S&P/ISM Mnfg PMI, (Thu night, KR Sept CPI, JP Sept Tokyo CPI & Core CPI, JP Aug Unemployment Rate, HK Aug Retail Sales).

- Friday October 2nd: AU Sept Preliminary CPI & Core CPI, US Sept Unemployment Rate & Non-Farm Payrolls & Average Hourly Earnings & Participation Rate, SG Sept S&P Mnfg PMI, (Fri night, VN Q3 GDP, Sept CPI & Trade Balance & Retail Sales & Industrial Production).

Holidays in Asia this week

- Monday September 28th: Taiwan.

- Thursday October 1st: China, Hong Kong.

- Friday October 2nd: China, India.

Headlines/economic data

Australia/New Zealand

-(AU) ASX 200 Index opens +0.1% at 8,6891.

-(AU) Reserve Bank of Australia (RBA) raises cash rate target by 25bps to 4.65%; as expected; reiterates will continue to do what it considers necessary to bring inflation sustainably back to target, including increasing the cash rate target further if needed.

-(AU) Australia Aug Household Spending M/M: 0.0% v 0.4%e; Y/Y: 6.8% v 7.1%e; Excluding fuel spending, total household spending would have fallen by 0.3 per cent.

-(AU) Australia ANZ Roy Morgan Weekly Consumer Confidence Index: 70.5 v 72.0 prior.

-(AU) Australia Treasurer Chalmers: Today’s interest rate rise was widely expected and anticipated, that doesn’t make it any easier for people.

-(AU) Firmus said to revise ASX listing date to Oct 23rd from Oct 22nd – US financial press.

-(AU) OPENAI.IPOStatement: Working closely with Australian Government agencies; To commit $1B daybreak fund credits to Australia cyber; To establish Australian taskforce on AI cyber risk.

-(NZ) New Zealand releases Pre-Election Economic and Fiscal Update: Cuts bond issuance program by -NZ$15B to NZ$144B; cuts 2026-2027 bond issuance program by -NZ$4B to NZ$30B (vs. NZ$34B pre-election).

-(NZ) 1News Verian Poll results indicate the New Zealand left bloc could govern if the Opportunity Party partners with a Labour-led coalition – Press [update].

China/Hong Kong

-(CN) Shanghai Composite Index opens -0.2% at 3,816; (HK) Hang Seng Index opens flat at 24,649.

-(CN) China's Premier Li: To step up efforts to meet annual economic targets; Should accelerate pace of issuance and use of various types of bonds; To adjust monetary policy tools at suitable times - China State Radio [EU market close].

-(CN) Follow-up: China has asked local governments to pilot 'high quality' policies to boost consumption; China to also expand the pilot program to merge advanced manufacturing and services - SCMP.

-(CN) China PBOC sets the yuan mid-point at 6.7411 v 6.7399 prior.

-(CN) China PBOC Open Market Operation (OMO): Sells CNY769B in 1-day Overnight Reverse Repo and 7-day Reverse Repos; Net injects CNY93B v injects CNY440B prior.

Japan

- (JP) Nikkei 225 Index opens -0.5% at 65,558.

- (JP) Japan sells ¥300B V ¥300B indicated in 40-year JGB bonds; lowest accepted price: 4.1250% V 3.8650% prior; bid-to-cover: 3.10X V 2.82X prior (strongest bid-to-cover ratio since 2020).

- (JP) Japan July Final Leading Index CI: 117.7 v 117.9 prelim.

- (JP) Japan Sept 1-10 Exports Y/Y: +23.3%; Imports +16.7% (provisional).

- (JP) Japan Fin Min Katayama: Exchanged views on FX trends with Bessent on Friday; Agreed with Bessent to beef up cooperation when asked about phone talks on September 25th, 2026 - Tokyo, Japan.

- (JP) Japan MOF Key Points of the 120th Special Meeting of Participants in the Government Bond Market - update.

- (JP) Japan Chief Cabinet Sec Kihara: Multi-layered Japan-China communication is important; Refrain comment on Japan-China private business group - Tokyo, Japan.

- (JP) Japan Trade Min Akazawa: We are always open to communicate with China - Tokyo, Japan.

- (JP) 3659.JP Shares fall -13% trading ex-dividend [>1,400 Japanese firms trade ex-dividend on 29/09/2026 JST].

Korea

-(KR) Kospi Index opens -0.7% at 6,8442.

-(KR) South Korea Sept Business Manufacturing Survey: 99.5 v 103.8 prior.

-(KR) South Korea Finance Minister: Closely monitoring bond market; to conduct treasury bond buyback if bond yields rise excessively.

-(KR) South Korea Military: Would take appropriate measures regarding the mine blast once final results are available; would consider all options in determining a military response [in response to the DMZ blast that injured two South Korean soldiers on September 21st, 2026] - (update).

-(KR) South Korea said to consider regulations related to high-frequency trading - US financial press.

-(KR) 005930.KR Samsung units to invest $1B in KKR's AI infrastructure company Helix Digital infrastructure for global AI buildout - US financial press.

Other Asia

-(ID) Indonesia parliament passes 2027 budget bill into law (as expected).

-(ID) Indonesia Central Bank (BI): Rupiah weakens on higher global inflation, oil price risk; Rupiah depreciation due to worries about global inflation, fiscal risks amid high crude prices, interest rates.

-(MY) S&P affirms Malaysia sovereign rating at 'A-'; Outlook stable.

-(MY) Malaysia Transport Minister Loke handed resignation to Malaysia PM Anwar.

-(MY) Malaysia Transport Minister Loke: Malaysia ports to target handling 100M TEUs by 2035 - Kuala Lumpur, Malaysia.

-(SG) Singapore Central Bank (MAS) Deputy Chair Chee: To introduce a S$16M market-making sleeve in order to raise trading interest in SGX-listed stocks; reviewing capital requirements for insurance cos.

-(PH) Philippines Treasury: To offer up to PHP892B of bills and bonds in Q4.

-(IN) India Central Bank (RBI) said to be likely selling USD through state-run banks to limit the Rupee weakness – traders.

-(TH) Thailand Central Bank sells THB60B in 3-month Bills: Avg Yield: 0.97721% v 0.96072% prior; bid-to-cover: 1.40x v 1.13x prior.

North America

-(US) Sept Dallas Fed Manufacturing activity: 9.8 V 7.8E [US market close].

-(US) President Trump: We will win Iran war very soon and gas prices will come tumbling down [US market close].

-(US) House Speaker Johnson: Have to remain vigilant against Chinese threat; We need Taiwan to be stable and independent [US market close].

-(US) Fed's Cook (voter): Expect to see continued inflation pressure in coming months; Number and magnitude of future rate adjustments will be informed by data; Labor market appears to be well positioned to handle an increase in rates [US market close].

-(US) Fed Vice Chair of Supervision Bowman (FOMC voter): Within the next few weeks and months, regulators expect deliverables including finer FinCEN guidance and a possible Reg CC update to improve fraud response across the banking system. [US market close].

-(US) Fed’s Barkin (non-voter): Low unemployment is a key factor for consumption [US market close].

-(US) President Trump to participate in AI lunch at 12:30pm ET on Tuesday [September 29th, 2026] - US financial press.

-(US) Rep Khanna to introduce a bill to regulate artificial intelligence; includes ban on 'recursive technology' - CNBC.

-(US) 15 states to sue the FAA over environmental review of commercial drone package delivery regulations - Press.

-(US) California Gov Newsom now permitting winter-blend gas sales (follows Gov Abbott of Texas earlier today).

-(US) FDA: To evaluate changes to premarket tobacco product application regulatory framework.

-(US) President Trump: The Protect College Sport Act just passed in the U.S. Senate by a vote of 77-22. This is a really big deal. It will not only save college sports, it will save the colleges themselves. Congratulations to Randy Levine, President of the New York Yankees, and all of those who worked with him, on a job well done!

-(US) BA FAA Administrator: Software issue will delay Boeing 737 Max certification, not clear for how long [US market close].

-(US) NVDA Launches open agent safety platform OpenShell with runtime controls and hardware watchdog [US market close].

-(US) NVDA Authorizes additional $150B share repurchase, raising remaining authorization to $235B; Through FY28 [US market close].

-(US) SPCX Starship Flight 14 suffers partial engine failure during first orbital test launch but still reaches orbit for the first time [US market close].

-(US) ANTHROPIC.IPO Reports FY25 GAAP Net -$41.97B v -$8.31B y/y, Op -$8.06B v -$2.98B y/y, Rev $4.59B v $386M y/y.

-(US) GS Board has discussed a plan to name COO John Waldron as its next CEO around end-2027 or 2028 - WSJ.

-(US) NVDA Turns to insurers to spread the risk of AI build-out - FT.

-(CA) Canada Energy regulator: Approves the Trans Mountain settlement which establishes a new framework for tolls.

Europe

-(RU) Russia reportedly plans to extend diesel export ban through Oct - press (as expected) [EU market close].

-(EU) ECB Chief Lagarde: Outlook continues to be surrounded by high uncertainty; View a measured response as appropriate to keep inflation in check [EU market close].

-(UK) FM Miliband: Cannot leave AI guardrails to corporations; Our future lies in stronger partnership with EU; Investment in defense is core part of govt policy - comments from Labour Conference [EU market close].

-(DE) Hapag-Lloyd raises FY26 EBITDA guidance to $3.9-4.4B (prior $2.7-3.7B), EBIT to $1.25-1.75B (prior $0.1-1.1B); Cites strong demand and spot freight rates [EU market close].

-(DE) Germany issues EU budget ultimatum - FT.

-(EU) ECB’s Pereira (Portugal): natural gas price pressures could lift inflation this winter [EU market close].

-(UK) BOE Dep Gov Ramsden: Case for hike if upside pressures persist; Focus is on energy prices; Current stance continues to provide restriction [EU market close].

-(UK) RAC: UK price of diesel hits all-time high at 199.18p per litre (~$10.09 per gallon) [EU market close].

-(UK) Sept BRC Shop Price Index Y/Y: 1.4% v 1.5% prior.

-(IE) Ireland Sept Consumer Confidence: 61.1 v 63.2 prior.

-(NL) Netherlands Sept Producer Confidence Index: 4.2 v 3.7 prior.

-(PL) Poland Fin Min Domanski: Sees no room to boost budget spending in 2027.

-(FI) Finland Aug House Price Index M/M: 0.0% v -0.3% prior; Y/Y: -3.3% v -3.4% prior.

-(FI) FIA1S.FI Q3 pre-close call: Demand remains robust entering late Q3: consumers are still planning travel and booking tickets despite higher interest rates and inflation; management called the market “resilient,” while closely watching whether pressure on consumer wallets weakens 2027 demand. [EU market close].

Middle East

-(SA) Saudi Arabia's East-West pipeline confirms it has resumed Oil exports - press [EU market close].

-(IR) US Secretary of State Rubio: Strait of Hormuz open except for Iranian oil; Iran heading quickly to bankruptcy; Iran economy now is a cataclysm - Fox News.

-(IL) US Treasury Department Readout: The Secretary urged the Lebanese government to take proactive steps to disrupt Iranian and Hizballah financial networks. Treasury Secretary Bessent also noted the importance of Lebanon advancing key financial sector reforms to restore confidence in Lebanon’s banking system.

-(IR) US, Iran expected to hold separate talks with mediators on Monday or Tuesday - press [US market close].

-(IR) Iranian officials said to be pessimistic about reaching a deal with the US before the Midterm elections - press [EU market close].

-(IR) New US Senate report finds that Tether's USDT has become a primary payment method for Iran [US market close].

-(IR) Iran Supreme Leader Khamenei: Enemy forces do not date enter Gulf and the Arabian Sea would soon be cleared of enemies [EU market close].

-(IR) Reportedly US President Trump is open to Iranian sanction relief on for nuclear issue progress - US official speaking to Al-Jazeera [later DENIED].

-(IR) Iran Foreign Minister Araqchi: Met with Qatari mediators and discussed ideas that will be shared with the US via the mediators.

Levels as of 01:20 ET

Nikkei 225 -1.3%; ASX 200 -0.2%; Hang Seng -0.5%; Shanghai Composite flat; Kospi -1.0%.

Equity S&P500 Futures -0.3%; Nasdaq100 -0.4%; DAX flat; FTSE100 +0.1%.

EUR 1.1374-1.1359 ; JPY 157.58-157.21; AUD 0.7030-0.7008; NZD 0.5677-0.5654.

Gold +0.4% at $4,130/oz; BTC flat at $83,321; WTI Crude Oil +1.9% at $94.34/bbl; Copper +0.2% at $6.6170/lbs.