Daily Global Economy Overview — Friday, September 26, 2025

The global picture leaned soft-landing friendly: U.S. inflation stayed contained while consumption accelerated, and a higher GDPNow estimate pointed to solid third-quarter momentum.

Europe’s data mix was steady to slightly firmer—Spain outperformed and Italian confidence held—amid slightly higher Italian auction yields and cautious messaging from the ECB.

In Asia, Singapore’s industrial output slumped after a strong July, while China’s industrial profits turned positive year-to-date, hinting at margin repair.

Across the Americas, Canada’s growth firmed in July but stalled in August, Brazil’s external accounts improved, and Mexico’s goods trade surplus widened in USD terms.

Market internals showed higher U.S. oil and total rig counts and positioning that was more constructive on risk and select EM FX, even as long-run U.S. inflation expectations ticked up.

United States

Core PCE inflation held at 2.9% year on year in August (0.2% m/m), with headline PCE at 2.7% (0.3% m/m).

Personal spending accelerated to 0.6% m/m while incomes rose 0.4%; real consumption increased 0.4%, underscoring resilient demand into late Q3.

Sentiment cooled: University of Michigan headline fell to 55.1, with current conditions at 60.4 and expectations 51.7; 1-year inflation expectations edged down to 4.7% while 5-year rose to 3.7%.

The Atlanta Fed’s GDPNow estimate for Q3 moved up to 3.9%. Energy supply signals were modestly expansionary: oil rigs rose to 424 and total rigs to 549.

CFTC data showed risk appetite stabilizing—net shorts in the S&P 500 narrowed, Nasdaq 100 net longs increased, and crude net longs rose—while gold net longs were essentially unchanged.

Euro area

Spain surprised on the upside with Q2 GDP up 0.8% q/q and 3.1% y/y. Italy’s consumer confidence improved to 96.8 and business confidence held at 87.3.

At the sovereign front end, Italy’s 5-year BTP auction cleared at 2.94% and the 10-year at 3.62%, both a touch higher than previous, suggesting slight upward pressure on yields.

French jobseekers fell to 3.022 million, indicating incremental labor-market healing.

Investors parsed ECB President Christine Lagarde’s remarks against a backdrop of low-gear growth and ongoing disinflation.

Asia-Pacific

Singapore’s industrial production retraced sharply after July’s surge, down 9.7% m/m and 7.8% y/y, reflecting a volatile manufacturing pulse.

In Japan, BoJ board member Noguchi’s appearance kept attention on the pace of normalization amid mixed domestic signals.

China’s January–August industrial profits turned positive at 0.9% year-to-date from a prior decline, hinting at some improvement in margins.

Market positioning leaned more constructive on the yen (speculative net longs increased) and more cautious on high-beta commodity FX such as AUD and NZD.

India

Bank credit growth held double-digit at 10.3%, with deposits rising 9.8%; FX reserves were broadly steady at $702.6 billion.

The combination points to adequate banking-system funding and continued support for domestic demand, even as deposits lag credit.

Canada

Monthly GDP rose 0.2% in July but was flat in August on the flash read. Wholesale sales fell 1.3% in August.

The federal budget swung to a C$1.51 billion deficit in July (and a larger year-on-year shortfall), signaling fiscal slippage even as growth momentum improved in early Q3. CFTC data showed deeper speculative CAD shorts.

Brazil

External balances improved: the current-account deficit narrowed to $4.67 billion and FDI inflows were a solid $7.99 billion.

The mix suggests financing remains comfortable, even as domestic inflation earlier in the week complicated the near-term policy path.

Mexico

The goods trade surplus in USD terms widened to $0.61 billion in August (from $0.22 billion prior), pointing to firmer net-export support.

Broader accounting still showed a small deficit on the headline series, but the hard-currency balance improved.

Markets and positioning

Speculators added to crude net longs and trimmed net S&P 500 shorts; Nasdaq 100 net longs rose.

FX positioning showed larger net longs in JPY and MXN and higher longs in BRL, while EUR longs eased and CAD/AUD shorts deepened.

The pattern is consistent with selective risk-taking and carry preferences, anchored by stable U.S. disinflation and firm consumption.

Why it matters

• Growth: U.S. real spending and a stronger GDPNow track keep the world’s demand anchor intact; Spain’s outperformance adds a European bright spot, while Canada’s two-speed print and Singapore’s swing underline how uneven manufacturing remains.
• Inflation: Core U.S. PCE is steady and compatible with gradual easing of financial conditions, but the uptick in 5-year inflation expectations bears watching.
• Policy: With the ECB cautious and the BoJ measured, the asynchronous policy map persists. Stable U.S. disinflation alongside solid demand keeps global rate differentials a key driver of currencies and cross-border flows into Q4.

This article was produced by The Rio Times’ automated newsroom system. How we use AI · Report an error

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