Stablecoin Trading Volume Jumps to Over $1T — Market Talk
1027 ET - The amount of stablecoins — cryptocurrencies pegged to traditional assets like the U.S. dollar --traded in September rose nearly 25% from the prior month, totaling $1.01 trillion, says CoinDesk in a note. It's the first time since March that stablecoin volumes have been over the trillion mark, coinciding with big jumps in bitcoin and other major cryptocurrencies seen in September. "The gap between modest supply growth and a sharp rise in turnover points to higher velocity rather than fresh capital alone," says CoinDesk. Bitcoin is up 0.6% to $86,343, while ethereum rises 0.2% to $2,718, XRP climbs 0.6% to $1.51, and solana is up 0.3% to $120.97. ([email protected])1025 ET - Demand for French debt is still healthy, demonstrated by the fact that French bond auctions remain well covered, says Ken Egan at KBRA in a note. The market remains willing to absorb supply, he says. Still, investors are increasingly looking for at a price that reflects broader political and policy uncertainty. "With fiscal uncertainty elevated, political rhetoric becoming more challenging, and policy scenarios that would normally sit at the margins now being discussed more openly, the market has more room to demand a higher yield," Egan says. ([email protected])1022 ET - The demand for AI-related goods continues to push up imports, according to Oxford Economics in a note. The August U.S. trade deficit widened to $105.6 billion from a revised $92.8 billion in July. That's the largest trade deficit since March 2025, when frontloading ahead of the Trump administration's tariff implementation was in full swing, Oxford says. The U.S. is currently locked in a trade war with Canada, which imposed retaliatory tariffs that took effect last month on about $20 billion worth of U.S. goods. ([email protected])1018 ET - Canada registered a decent trade position in August, with the largest surplus in more than four years, albeit propped up by temporary tariff front-running, Bank of Montreal's Shelly Kaushik says. "Although new tariff challenges await in September, the August strength suggests the economy was weathering the storm better than expected in 3Q," she says. The economist adds that in the short term elevated energy prices should continue to buoy exports in the coming months, but over the longer term a more stable U.S. trading relationship is crucial for trade flows. Until there is that stability, anticipated export capacity and other diversification efforts could help cushion the blow, Kaushik says. ([email protected]; @RobbMStewart)1007 ET - The Japanese yen has the potential to recover versus the dollar next year if the market reduces expectations for interest-rate rises by the Federal Reserve, Rabobank's Jane Foley says in a note. The yen's weakness since the last Bank of Japan policy decision reflects some impatience in the market over a lack of "hawkish" signals for further interest-rate rises, at least compared to the Fed, she says. "It is Rabobank's house view that the market has anticipated too much Fed policy tightening next year." The dollar trades flat at 157.97 yen and Rabobank maintains a three-month target of 155.00. ([email protected])1002 ET - The euro should continue to recover from its recent selloff versus the dollar as the Federal Reserve is unlikely to raise interest rates beyond what the market has already priced in, TD Securities strategists say in a note. "The U.S. economy is resilient but not exceptionally heating up and the Fed will hike at a quarterly pace like other central banks." Meanwhile, the spread between French-German government bonds has retraced from multiyear highs. Nonetheless, the current stability remains fragile and it will likely take time for markets to close bets on the euro falling versus the dollar, they say. The euro rises 0.3% to $1.1257 after reaching $1.1160 Monday, its lowest level in more than 16 months, according to LSEG. ([email protected])0935 ET - Cross-border payments are currently the clearest use case for blockchain-based securities, says Ava Labs' head of institutional finance. The move to blockchain will grow exponentially in some asset classes, Mike Manning says at the Digital Assets Week conference in London. "By 2030 there will be some asset classes that are majority digital." Trading in assets in traditional venues and on blockchain will increasingly converge, Manning says. For investors, the priority is gaining price exposure to an underlying asset--the technology via which they invest in the asset is less important, Manning adds. ([email protected])0930 ET - Wall Street is on pace for a far stronger year than anticipated. Profits totaled $45.9 billion in the first half of 2026, up 51% from the same period last year, according to a report by New York State Comptroller Thomas DiNapoli. First-half profits have surpassed New York City's $45.3 billion forecast for the entire year, and if that pace of growth continues, profits could exceed $90 billion in 2026, the report says. "Wall Street is having an exceptionally strong year, fueled by a boom in artificial intelligence spending, increased merger and acquisition activity, and elevated trading volumes amid market volatility," DiNapoli says. "Despite geopolitical tensions and economic uncertainty, the industry has remained resilient." ([email protected])0906 ET - What goes up has a habit of coming back down, and that may be the case with Canada's goods-trade surplus that widened sharply in August. Exports were up for the month and imports fell for the first time in seven months. The depreciation in the Canadian dollar to the greenback played a role, but then so likely did tariffs. Exports to the U.S. surged, but fell to non-U.S. countries. Recall the Trump administration in late July proposed new tariffs on a range of Canadian goods, which came into effect late in August and may have spurred front-running similar to what Canadian shippers saw in early 2025. The share of Canadian exports heading to the U.S. climbed to 69.8% in August, the largest share since September 2025, after sliding to 66% in July. ([email protected]; @RobbMStewart)0858 ET - Treasury yields slip as a global bond selloff eases amid a 3% decline in oil prices. Borrowing costs, however, remain close to recent highs, as markets worry about inflation, government spending and corporate borrowing. The U.S. trade deficit widens more than expected in August, to $105.6 billion. The Treasury is auctioning $58 billion in three-year notes and elevated yields are expected to ensure robust demand. The 10-year yield trades at 5.273%, down from yesterday's settlement of 5.310%, which was the highest since April 2002. The two-year falls to 4.785% from 4.831%. ([email protected]; @ptrevisani)0852 ET - Sterling looks vulnerable ahead of the October 28 U.K. budget, Morgan Stanley strategists say in a note. The budget could bring a delay to the consolidation process and lower fiscal headroom, they say. "We see risks to our estimates as skewed towards a bigger headroom hit, as we don't incorporate any major adjustment from lower immigration flows." This implies some insufficient pricing of fiscal risks in sterling, they say. Morgan Stanley recommends selling sterling against the dollar with a target of $1.2850 and a stop loss of $1.3350. Sterling is last up 0.5% at $1.3279. ([email protected])0810 ET - Central 1 Credit Union anticipates the Bank of Canada will raise interest rates twice, and won't make its first move until early next year, despite financial markets pricing in a more aggressive rate cycle. Economist Bryan Yu says the country is in a period of high uncertainty and the outlook is fluid, with soaring bond yields, tariff impacts and high oil-price volatility. Canadian core inflation remains near 2% and economic growth is likely to slow in late 2026 with trade uncertainty, with higher bond yields tempering a housing-market recovery, Yu notes. ([email protected]; @RobbMStewart)