- Fed hold off from raising rates; lift-off in December remains “live”
- Renminbi appreciates against the strong dollar; onshore +0.64%, offshore +0.61%
- Fund’s USD class gained +2.59%
- Broadly positive performance across all holdings; Russia quasi-sovereign issues outperform
- IMF to decide renminbi SDR inclusion by the end of November
Market focus once again remained on the Fed rate decision and softening economic growth in China. The month started with a disappointing US non-farm payroll reading which dampened expectations for an October rate lift-off. Further mixed data out of the US did little to convince the market otherwise and as the futures market had predicted, the Fed held off from raising rates at the October meeting. Having fallen as low as 1.97%, off the back of soft retail sales data the benchmark ten-year US Treasury yield ended up 11 basis points on the month at 2.14%, as the market was spooked by the Fed’s more hawkish comments that a December rate hike is firmly in play.