Daily Financial Breakfast 31 October 2026: What Do Calls by Fed’s Logan for Two More Rate Hikes and Binance’s Reported $6.3 Billion Hack Mean for Markets?

Market News Today: What Is Driving Currencies, Bitcoin and Gold?

• Further rate increases remained on the Fed agenda as Dallas Fed President Lorie Logan urged at least two more quarter-point moves, while other Fed officials supported proceeding gradually.
• A slide towards $77,000 left Bitcoin at a six-week low following Binance’s disclosure of a $6.3 billion hack.
• Japan’s policy rate stayed at 1.25% following an 8–1 Bank of Japan vote, while the bank lifted its fiscal 2027 core inflation forecast from 2.4% to 2.6%.
• Bullion came under pressure as the U.S. dollar and Treasury yields inched up, taking gold to a year-to-date low of $3,880.
• October brought an ECB rate hold, with Lagarde maintaining that the policy direction was clear unless fresh information materially altered the assessment.

What Moved the Markets?

How Did Major Currencies Perform?

A recovery in the U.S. Dollar Index ended a run of two weekly declines, with the index finishing around 102.00 against a weekly peak near 102.50. Friday saw EUR/USD ease from its intraday high of 1.1214 to around 1.1140.

What Is Next for U.S. Interest Rates?

Why Does Logan Want at Least Two More Quarter-Point Fed Rate Increases?

A gradual pace of tightening would limit the risk of a sharp economic downturn, Dallas Federal Reserve President Lorie Logan argued on Friday, while calling for “at least two more quarter-point rate hikes”. In her view, skipping an increase “doesn’t change policy destination,”.

Separately, a gradual path also had the backing of St. Louis Fed President Alberto Musalem, even as he argued that rates needed to rise “again soon,”.

For Richmond Fed President Thomas Barkin, the issue was how quickly to adjust policy rather than which direction to take. In an interview with SiriusXM Business Briefing, he described that direction as “straightforward” and gradual steps as “a good way to go”. Reports from businesses also pointed to broader cost pressures, he said.

What Is Weighing on Cryptocurrencies?

Why Did Bitcoin Hit a Six-Week Low After Binance’s $6.3 Billion Hack Report?

Broad-based selling in cryptocurrencies weighed on Bitcoin on Friday, taking it close to $77,000 and a six-week low. Binance’s disclosure of a $6.3 billion hack preceded the sell-off.

Where Is Japan’s Monetary Policy Heading?

Why Is the BoJ Warning of an Inflation Overshoot While Holding at 1.25%?

With only board member Takata favouring an increase to 1.5%, an 8–1 vote at the Bank of Japan retained the short-term policy rate at 1.25%. Governor Kazuo Ueda nevertheless indicated that policy would continue to be adjusted as required.

Despite accommodative financial conditions and low short-term real interest rates, underlying inflation had reached a level broadly aligned with the BoJ’s 2% target, the bank said. Its revised forecasts put fiscal 2027 core CPI inflation at 2.6%, up from 2.4%, while retaining the fiscal 2028 estimate of 2.0%. GDP growth projections were adjusted to 0.7% for both fiscal 2026 and fiscal 2027.

An inflation overshoot, rather than a shortfall against the target, had become the greater risk, policymakers indicated. Among the developments the bank said warranted close attention were foreign-exchange volatility, stronger AI-related demand and the Middle East conflict. As corporate demand for funding increased, lenders continued to show a willingness to extend credit.

Rather than waiting passively for inflation to increase, Ueda said the BoJ would take proactive action where necessary. Inflation still had to settle sustainably around 2%, he cautioned. There was no fixed schedule for policy changes: data, wages, financial conditions and the economic outlook would guide both their timing and pace.

Most major currencies lost ground against the yen after the announcement. A subsequent U.S. dollar rebound helped USD/JPY pare its earlier losses, but the pair was still marginally down as the weekend approached.

Why Is Bullion Under Pressure?

What Drove Gold to This Year’s Low of $3,880?

Modest increases in the U.S. dollar and Treasury yields, weakening risk appetite and Fed officials’ arguments for further rate rises weighed on gold on Friday. The metal reached $3,880, its lowest point of the year, breaching $3,900 for the first time since October last year.

What Is Shaping European Monetary Policy?

What Does Lagarde’s Meeting-by-Meeting Approach Mean After the ECB Rate Hold?

A meeting-by-meeting approach remained central to Lagarde’s message as the European Central Bank left its key rates on hold in October. UOB economist Lee Sue Ann cited her remarks that, barring incoming information that materially changed the current assessment, “the direction of travel is quite clear.”

Against the assumptions used in the ECB’s September projections, average 10-year sovereign yields were up by around 35 basis points, according to Lagarde. She added that households and businesses faced higher borrowing costs, while equity prices had declined.

Which Events Should Markets Watch Next?

• What Will U.S. Manufacturing Releases Show? (2 November 2026): Due from the United States are the final S&P Global Manufacturing PMI, alongside the ISM Manufacturing PMI and construction spending figures.
• When Will U.S. Midterm Election Results Start Arriving? (3 November 2026): The scheduled flow of U.S. midterm election results begins.
• What Is Due Alongside U.S. JOLTS Job Openings? (3 November 2026): Factory orders accompany the scheduled U.S. job openings report.
• Which U.S. ADP Employment and Services Figures Are Due? (4 November 2026): ADP employment is on the U.S. release calendar with the final S&P Global Services PMI, as well as the ISM Services PMI and trade figures.
• When Is the Eurozone Preliminary Inflation Release? (4 November 2026): Alongside preliminary eurozone inflation data, final services PMIs are due for Germany and the eurozone.
• Which U.S. Jobless Claims and Job-Cut Figures Are Scheduled? (5 November 2026): Challenger job-cut figures share the release calendar with weekly U.S. initial unemployment claims.
• What Is Due on U.S. Payrolls, Unemployment and Consumer Sentiment? (6 November 2026): The preliminary University of Michigan consumer sentiment reading accompanies the scheduled U.S. nonfarm payrolls and unemployment rate releases.
• When Will the Bank of England Decide Bank Rate?: A Bank Rate decision by the Bank of England’s Monetary Policy Committee is scheduled for the coming week.