The Federal Reserve has finalized revisions to its stress test of major banks, including a requirement that the Fed collect public input on the scenarios and material changes to the models used in the annual test. The final rule also mandates that capital buffer requirements be calculated by averaging the results from the two most recent stress tests "for firms subject to the stress test in both years." Fed Governor Michael Barr cast the sole vote against the final rule, which he said will "significantly weaken the stress test and, consequently, bank resilience."

The Bank of England has warned that the financial system faces the risk of a sharp market correction because of the surge in debt issuance to fund artificial intelligence infrastructure. AI-related debt issuance reached $450 billion in the year to September, more than double the previous year, according to Morgan Stanley. The BoE notes that if AI-driven productivity fails to meet expectations, it could affect asset valuations and sovereign debt markets.

The Financial Conduct Authority has shifted from mandatory climate-risk reporting for listed companies to a "comply or explain" approach as of 2027, aligning with international standards. The FCA's move follows similar actions by the EU and the Securities and Exchange Commission, reflecting a global trend of easing climate disclosure rules to reduce business burdens. The FCA's decision aims to maintain the UK's investment appeal without disadvantaging companies competitively.

The EU reached a preliminary agreement to halve risk-weighted floors on senior tranches of certain securitizations to 5% from 10%, reducing the capital banks must hold against them. The change is intended to boost mortgage- and asset-backed issuance and significant risk transfers, freeing bank balance sheets to support priorities including defense and climate investment.

Canada has contingency plans for a potential US diesel export ban, with Energy Minister Tim Hodgson saying the country could manage disruptions because it is a net exporter and its petroleum system is closely integrated with the US. Trump is weighing restrictions as diesel prices surge amid Middle East supply disruptions and Russian export curbs, though Hodgson said Canada is not currently facing shortages.

Foreign participation in China's repo market has surged, with transactions more than doubling over the past year. This growth follows regulatory changes granting more access to foreign investors, enabling them to leverage Chinese bonds for liquidity. Despite this progress, the market faces hurdles such as legal ambiguities and low yields. Efforts to integrate financial products and expand Hong Kong's role as an offshore yuan hub are seen as potential solutions to boost international demand.

Kalshi is ending its Volume Incentive Program amid regulatory scrutiny and allegations of inflated trading volumes. The program, which aimed to boost liquidity by rewarding traders, will be terminated no earlier than Oct. 13, according to a filing with the Commodity Futures Trading Commission. Kalshi has denied any wrongdoing, stating that the repeated trades were due to market makers posting fixed quotes.