# Trump says Russia-Ukraine energy ceasefire agreed as U.S. core CPI seen slowing By Token Post Canonical URL: https://www.tokenpost.com/news/investing/29946 Published: 2026-10-11T23:41:43.000Z Updated: 2026-10-11T23:41:43.000Z Section: Investing > Trump's Russia-Ukraine energy ceasefire announcement and a softer U.S. core CPI forecast framed the week. Markets also weighed Treasury-yield risks, China support measures and geopolitical energy risks. Trump's announcement of a Russia-Ukraine energy ceasefire and Iran's hard-line response added to geopolitical uncertainty. U.S. inflation, Treasury yields and Chinese policy support emerged as key variables for financial markets this week. As of Oct. 12, U.S. President Trump said Russia and Ukraine had agreed to an energy ceasefire that would take effect immediately. He declined to give further details on the process, terms or follow-up steps. Senior Ukrainian figures said the announcement was sudden but that Ukraine would agree if Russia did. Markets viewed the move as an effort by Trump, ahead of the midterm elections, to contain gasoline and diesel price increases. ## Key issues Iran expressed dissatisfaction with the U.S. response to a proposal to end the war. Rezai, secretary of Iran's Supreme National Security Council, said the response was insufficient and warned that Iran would attack data centers and other targets if fighting resumed. He said Iran would no longer respond to U.S. demands and stressed that the Strait of Hormuz is a major national asset, meaning Iran's interests are not limited to closing the strait or collecting transit fees. Mohammad Eslami, head of Iran's Atomic Energy Organization, said Iran would not give up its self-developed nuclear technology even if major powers tried to force submission. Middle East tensions also persisted. An international airport in Riyadh, Saudi Arabia, was attacked over the weekend, killing 12 people. Yemen's Houthi rebels said they were responsible. Despite the energy ceasefire agreement, supply concerns and security risks from the Middle East remained variables for international financial markets. The U.S. September consumer price index is scheduled for release on Oct. 14. Markets expect headline CPI inflation to rise to 3.7% year over year from 3.4%, and to 0.6% month over month from 0.4%. Core CPI, however, is expected to slow to 0.2% month over month from 0.3%. The annual core rate is estimated to edge up to 2.5% from 2.4%. One interpretation was that inflation pressure is rising in certain industries or regions rather than across the broader economy. That suggests current conditions differ from 2022, when the rate-increase cycle began, and the CPI outcome could support expectations for a rate hold in October. Still, inflation pressure was broadly seen as elevated, leaving the probability of a December rate increase high at 70.2%. ## Market impact In the U.S. Treasury market, caution grew over the risk of higher yields. PIMCO said technical factors and possible stop-loss selling by leveraged investors could temporarily lift the U.S. 10-year Treasury yield to 6%. Citi said the Treasury is likely to reduce long-term debt issuance in November, though the reduced amount could be made up with additional issuance later. Corporate earnings were cited as a support for technology shares. LSEG estimated that S&P 500 companies' third-quarter earnings rose 31% from a year earlier, with AI and other technology firms accounting for a large share of the increase. Germany's central bank said Europe's debt crisis had recently intensified and warned that stress in France could affect some neighboring countries. In weekly global markets, the U.S. S&P 500 rose 1.15% to 7,811.5 on expectations for solid corporate earnings and strength in technology shares. Europe's Stoxx 600 edged up 0.03% to 631.55, helped by the U.S. market, while Japan's Nikkei 225 gained 1.06% to 69,031. Korea's KOSPI fell 5.39% to 6,625.9. The VIX risk indicator declined 3.07% to 14.84. In foreign exchange, euro weakness on French fiscal concerns helped support the dollar. The dollar index rose 0.28% to 102.21, while the euro fell 0.49% to 1.1200. The yen slipped 0.29% to 158.31. The won-dollar exchange rate fell 0.16% on the week to 1,342.0, while Korea's CDS was little changed at 24bp. In bonds, the U.S. 10-year Treasury yield fell 3bp to 5.24% on bargain buying and expectations for an October rate hold. Germany's 10-year yield rose 2bp to 3.48% after hawkish remarks from key ECB officials. Japan's 10-year yield fell 7bp to 3.02%. In commodities, Brent crude rose 2.42% to $104.72, while gold gained 1.28% to $4,194.2. ## Country developments The European Union and China agreed to reduce exports of Chinese hybrid vehicles to the EU. Trade Commissioner Sefcovic said China had decided to cut hybrid vehicle exports by more than half. China's commerce ministry, however, avoided releasing specific details. The agreement was presented as a step toward easing trade tensions between the two sides. China moved to expand support to meet this year's economic targets. The National Development and Reform Commission said it would strengthen countercyclical support and prepare additional high-efficiency policy tools. The Communist Party Central Committee and the State Council emphasized active policies, including scientific innovation, to improve new quality productive forces, while also signaling an intent to restrain indiscriminate investment. China's securities regulator discussed institutional improvements and measures to increase medium- and long-term investment inflows to stabilize the stock market. Participants assessed the recent market as stable but recommended broader capital inflows and more diversified investment channels to sustain stability. India's central bank announced emergency measures to stabilize the rupee, including a special window to meet U.S. dollar demand from state-run oil companies and cash deposits for some banks' foreign-exchange transactions. Major economic events included the U.S. Columbus Day market holiday and remarks by Cleveland Fed President Hammack. Ahead of the U.S. inflation release, the rate outlook again became a central market variable, while Chinese policy support and India's currency-stabilization steps were also cited as factors shaping country-specific financial conditions. ## Overseas views Reuters said four signals pointed to further upside risk for U.S. Treasury yields. Demand to hedge against recent yield increases has lifted interest-rate option volatility to the highest level since March 2023. Increased corporate bond issuance by hyperscalers could also pressure corporate and Treasury yields higher. More hedging of mortgage securities implies more hedging of Treasuries, while a steeper long-term yield curve suggests a higher long-term Treasury premium as fiscal deficit concerns increase. Reuters also said major central banks face a test of price stability amid fiscal-debt concerns. The U.S., France and Italy are scheduled to hold several elections over the next one to two years, making large spending-cut discussions less likely. Fiscal-debt pressure and higher government bond yields could intensify, leaving central banks exposed to political pressure to stabilize markets through active bond purchases. If bond-market instability persists, demands for economic stabilization may rise, but large-scale quantitative easing could fuel inflation, prompting the IMF and others to call for urgent fiscal consolidation rather than reliance on central-bank rescues. The Financial Times said the global economy has remained more resilient than expected despite high U.S. tariffs, energy supply disruptions from the Middle East war and rising major government bond yields. Energy stockpiling, fiscal support, AI-related semiconductor demand and data-center investment have helped support growth. Still, instability in government bond markets from rising public debt, deeper energy disruptions from a prolonged Middle East war and weak returns on AI investment were identified as potential risks. Governments need fiscal room and more diversified trade and energy sources to prevent external shocks from spreading through the broader economy. The Financial Times said the U.S.-Russia diesel supply agreement may have limited practical effect. Trump agreed with President Putin on Russian diesel supply, raising expectations that global diesel shortages could ease. Russia is expected to expand supply gradually and could export about 1.2 million to 2 million tons from average monthly production of about 5.8 million tons. Even so, that would amount to less than 4% of global demand, and large-scale exports could be constrained if Ukrainian attacks disrupt refinery operations. Some critics said allowing Russian diesel exports would help finance Russia's war. Caution also increased around AI-related financial flows. The Financial Times said the decline in global AI bond issuance in September reflected investors' reassessment of debt risks. It also said excessive reliance on AI in global financial markets could create structural vulnerabilities. Bloomberg said China's oil imports are expected to increase into early next year as its supertanker fleet expands, with potential implications for oil prices. Bloomberg also said emerging markets are better positioned to respond to renewed European debt turmoil than in previous crises, helped by fiscal improvements.