If yesterday’s session was dominated by concerns about Fed tightening and rising long-end rates, today fears about a hawkish Fed have subsided, and as a result European, Asian stocks and S&P futures all rose amid speculation Federal Reserve policy will remain accommodative after yesterday’s dovish comments by Fed vice-Chair Stan Fischer who offet Friday’s hawkishness by Rosengren and Yellen.

This helped the USD-index fall off 7-month highs ahead of US inflation figures, after reports showed New York manufacturing unexpectedly shrank and U.S. factory output barely grew, while corporate earnings also dictate much of the price action in Europe. “The dollar has struggled to gain upside momentum today because of further evidence that the Fed’s tightening cycle will be very gradual,” Elias Haddad, an FX strategist at Commonwealth Bank of Australia in Sydney told Bloomberg. The weaker dollar helped lift oil and metals prices which in turn propelled commodity-linked stocks higher.

As Bloomberg further summarizes, stocks rallied around the world, commodities jumped and the dollar sank on speculation that a pick-up in the global inflation outlook won’t tempt the Federal Reserve to quicken the pace of monetary tightening. And speaking of inflation, the UK is already suffering the consequences of the sterling plunge when the Office for National Statistics said the annual inflation rate accelerated to 1% last month, from 0.6% in August, above the 0.9% rate forecast by economists and is the highest since 2014, pushing sterling well higher.

The pan-European STOXX 600 share index rose 1.2 percent, led higher by a 2.6 percent rise in the basic resources sub-index and a 1.4 percent gain in oil and gas firms. Britain’s internationally-focused FTSE 100 index, in which miners are heavily represented, rose 1.1 percent. MSCI’s broadest index of Asia-Pacific shares outside Japan gained 0.8 percent, led by financials and energy shares. Australia’s benchmark index was up 0.4 percent while Japanese stocks edged higher on a softer yen.

The MSCI All Country World Index of equities headed for its biggest advance in almost four weeks as investors parsed earnings reports. The Bloomberg Dollar Spot Index extended Monday’s retreat from a seven-month high after reports showed New York manufacturing unexpectedly shrank and U.S. factory output barely grew. South Africa’s rand and South Korea’s won led gains in emerging-market currencies. The Bloomberg Commodity Index rose for a fourth day to the highest in a week, with oil and metals climbing.

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Speaking of the Fed’s intentions, confusion appears to be the watchword not just about the Fed…

“The market has clearly come to a stronger view that they will raise rates in December but that has very little influence on where rates are perceived to go in the longer term,” said Adam Cole, head of global foreign-exchange strategy at Royal Bank of Canada in London. “In a more normal interest-rate cycle, if the market had moved to discount a December interest rate hike, it would probably have moved to discount three or four hikes next year and that’s simply not the case any more.”

But also about the presidential election:

 “We’re likely to see some choppy trading until we get some of these risk events out of the way, such as the last U.S. presidential debate,” James Woods, an analyst at Rivkin Securities in Sydney, said by phone. “Momentum seems to be building up for a December rate hike by the Fed.”

While Fed fund futures indicate the probability of a rate increase by the December meeting has risen to 66% , from about 55% a month ago, the data continues to come in on the weak side. The Bloomberg U.S. ECO surprise index — which measures whether data have exceeded or fallen short of analysts’ estimates — fell below zero for the first time in two weeks. Officials are still to form a consensus view to support a faster pace of tightening, with Chair Janet Yellen last week pondering whether a “high-pressure economy” could reverse some of the damage done in the recession.

The Stoxx Europe 600 Index rose 1.1 percent at 10:51 a.m. in London. Miners led gains as commodity prices advanced. Italian banks propelled lenders higher, with Banca Monte dei Paschi di Siena SpA jumping 6.5 percent after Il Sole 24 Ore reported that the board of directors will discuss a proposal to bolster the lender’s financial health from Corrado Passera, Italy’s former economic development minister. Among stocks moving on earnings-related news:

S&P 500 Index futures advanced 0.5%, after U.S. equities fell 0.3% on Monday amid a slide in health-care companies. The Hang Seng China Enterprises Index of mainland companies in Hong Kong rose 1.9 percent, its biggest advance since Aug. 1.The Philippine Stock Exchange Index climbed 2.9 percent, the most in five months. President Rodrigo Duterte starts a four-day trip to China on Tuesday, and there’s optimism it will yield investment deals and boost tourism, said James Lago, head of research at PCCI Securities Brokers Corp. in Manila.