Daily Global Economy Overview: Thursday, September 25, 2025

A broad upside surprise in the United States—spanning GDP, business investment, and trade—reinforced the global soft-landing narrative and kept the dollar and long-term yields supported.

Japan’s inflation slowed, easing pressure on the Bank of Japan and sharpening global rate-differential dynamics. In Europe, money and credit growth cooled even as household sentiment improved.

Emerging markets diverged: Mexico cut rates to support activity while Brazil’s mid-month inflation re-accelerated. Elsewhere, Switzerland held policy steady, auto registrations across major European markets painted a volatile demand picture, and Hong Kong’s trade flows firmed.

United States

Second-quarter GDP was revised up to 3.8% annualized, underpinned by 2.5% real consumer spending and a 2.1% GDP price index alongside 2.6% for core PCE.

August durable-goods orders jumped 2.9% month on month, with non-defense capital goods ex-aircraft up 0.6% and ex-defense orders up 1.9%, pointing to firmer capex.

The goods trade deficit narrowed to 85.5 billion dollars, wholesale inventories fell 0.2%, and retail inventories ex-auto rose 0.3%, suggesting cleaner pipelines.

Labor stayed resilient: initial jobless claims were 218,000 (four-week average 237,500) and continuing claims 1.926 million. Existing home sales slipped 0.2% to a 4.00 million annual rate, consistent with tight resale supply despite this week’s strength in new-builds.

Treasury auctions cleared smoothly (seven-year at 3.953%), while the Federal Reserve’s balance sheet edged to 6.608 trillion dollars and reserve balances to roughly 3.00 trillion.

Japan

Disinflation gained traction. National CPI slowed to 1.0% year on year, Tokyo core held at 2.5%, and the core-core gauge posted a monthly decline. Capital flows showed net foreign buying of Japanese bonds and continued net selling of equities.

The mix argues for a gradual normalization path from the Bank of Japan, keeping the yen highly sensitive to global rate spreads.

Euro area

Monetary aggregates cooled and credit growth remained modest: M3 slowed to 2.9% year on year; private-sector loans rose 2.5% and loans to non-financial corporates 3.0%.

Household sentiment firmed at the margin with Germany’s GfK at −22.3 for October and French consumer confidence steady at 87.

Italy’s six-month BOT auction cleared at 2.044%, underscoring stable short-end funding conditions. The bloc remains in low-gear expansion, led by services, with tight credit standards encouraging ECB caution.

Mexico

Banco de México lowered its policy rate to 7.50% from 7.75%, extending a cautious easing cycle aimed at supporting activity as price pressures cool. The move narrows the peso’s carry and may influence regional portfolio flows.

Brazil

Mid-month inflation re-accelerated to 5.32% year on year (0.48% month on month), complicating hopes for faster monetary easing. Markets weighed the surprise against growth risks as the National Monetary Council met.

Switzerland

The Swiss National Bank kept its policy rate at 0.00% and signaled continuity in its assessment. With domestic inflation subdued, CHF dynamics remain closely tied to external conditions.

United Kingdom and major euro-area auto markets

Auto registrations underscored a volatile durables backdrop. The UK fell 40.8% month on month and 2.0% year on year.

Germany declined 21.7% month on month but rose 5.0% year on year; France fell 24.5% month on month and rose 2.2% year on year; Italy dropped 43.2% month on month and 2.7% year on year. The UK’s retail survey improved slightly (CBI distributive trades −29).

Hong Kong

External momentum firmed: exports rose 14.5% month on month and imports 11.5%, narrowing the trade deficit to 25.4 billion Hong Kong dollars—a constructive signal for regional supply chains.

South Africa and Norway

South Africa’s producer-price inflation edged up to 2.1% year on year (0.3% month on month). Norway’s unemployment rose to 4.9% from 4.5%, adding nuance to the Nordic policy outlook.

Canada

Average weekly earnings increased 3.31% year on year, down from 3.59%, a trend consistent with disinflation and a cautious Bank of Canada stance.

South Korea

Manufacturing sentiment held steady with the business survey index at 70, signaling stabilization across the electronics-heavy industrial base.

Outlook

Global policy remains asynchronous: U.S. demand is firming as prices moderate, Europe is edging forward cautiously on slower money growth, Japan’s cooler inflation lowers urgency for tightening, and emerging markets are calibrating between growth support and inflation control.

Into the fourth quarter, yield curves and currency moves—anchored by U.S. rates and Japan’s trajectory—remain the key transmission channels for global risk appetite.