Daily Global Economy Overview: Tuesday, September 23, 2025
Global PMIs signaled a two-track expansion: the euro area accelerated on stronger German services while France slipped deeper into contraction; the US cooled but stayed above 50; India remained very strong despite easing a touch.
Inflation signals were mixed—further disinflation in Singapore contrasted with a tick-up in Australia’s core gauge.
Bond markets diverged, with a sharp rise at the long end in the UK, a modest uptick in Germany’s 2-year, and a lower stop at the US 2-year auction.
A sizable US crude draw rounded out a day that leaned mildly risk-supportive but uneven under the surface.
United States
Activity cooled at the margin but remained expansionary: manufacturing PMI 52.0 (from 53.0), services 53.9 (from 54.5), composite 53.6 (from 54.6). Regional signals were weak: the Richmond Fed manufacturing index fell to −17 (from −7), shipments −20, while services edged to 1 (from 4).
Household demand decelerated modestly with Redbook at 5.7% y/y (from 6.3%). The current-account deficit narrowed to −$251.3B in Q2 (better than consensus), and M2 rose to $22.20T (from $22.12T).
Funding costs eased at the 2-year note auction (3.561% vs 3.641% prior). A dense slate of Fed communication (Bowman, Bostic, Goolsbee, Powell) kept policy expectations in focus.
Euro area
The bloc’s composite PMI improved to 51.2 (from 51.0) with services 51.4 and manufacturing 49.5. Germany led the upside—composite 52.4, services 52.5—while manufacturing stayed below 50 at 48.5.
France weakened across the board: manufacturing 48.1, services 48.9, composite 48.4. Spain’s July trade deficit widened to €-4.01B.
At the front end, Germany’s 2-year Schatz auction cleared at 2.010% (from 1.960%). Overall picture: modest expansion with notable cross-country divergence.
United Kingdom
PMIs softened: composite 51.0 (from 53.5), services 51.9 (from 54.2), manufacturing 46.2 (from 47.0).
The 30-year gilt auction tailed higher at 5.480% (from 5.170%), highlighting long-end sensitivity even as the CBI orders balance improved to −27 (from −33).
Remarks from MPC members (Pill, later Bailey) framed the policy outlook amid slower momentum.
Asia-Pacific
India remained a global outlier on strength despite easing: manufacturing PMI 58.5 (from 59.3), services 61.6 (from 62.9), composite roughly 61.9 (from 63.2).
Singapore’s inflation cooled further with core CPI at 0.3% y/y (0.5% headline y/y), though the monthly headline rose 0.5% after a prior drop.
Japan observed a market holiday; later PMIs pointed to manufacturing contraction (48.4) with services still expanding (53.0), composite about 51.1.
South Korea’s consumer confidence slipped to 110.1 (from 111.4) but remained well above 100.
Australia’s weighted mean CPI accelerated to 3.0% y/y (from 2.8%), a reminder that services-core pressures persist.
Americas
Mexico’s July activity stumbled: IGAE −0.9% m/m and −1.1% y/y, though retail sales rose 0.1% m/m and 2.4% y/y.
Canada’s housing prices weakened further with new housing prices −0.3% m/m in August. Brazil’s Copom minutes were due; markets looked to tone rather than new figures.
Africa
South Africa’s leading indicator improved to 113.70 (from 112.68), suggesting gradual stabilization into Q3.
Commodities
US API reported a crude stock draw of −3.821M barrels, a supportive near-term signal for oil balances.
What it adds up to
- Growth: The euro area’s expansion is intact but uneven (Germany up, France down). The US remains above trend in PMIs despite regional softness. India’s demand is still exceptional. Mexico’s mid-year wobble stands out in the Americas.
- Inflation: Disinflation persisted in Singapore; Australia’s core re-firmed to 3.0%. Net-net, Asia offers a mixed inflation pulse.
- Rates and curves: UK long-end yields pushed meaningfully higher; Germany’s front end nudged up; the US 2-year stop moved lower, modestly easing front-end pressure.
- Policy signaling: Heavy Fed/BoE/ECB speaker traffic guides expectations more than hard data today; Australia’s inflation uptick may keep a cautious bias in the region.
Near-term watch-list
- Services resilience versus manufacturing softness in Europe—does Germany’s services strength persist into October while France lags?
- US policy tone—do Powell and colleagues lean into risk-management easing or emphasize data-dependence after today’s mixed prints?
- Australia’s inflation path—does the trimmed-mean re-acceleration broaden, complicating the disinflation narrative?
- Mexico’s slowdown—do subsequent hard data corroborate July’s IGAE drop, or was it noise?
- UK rates—does the 30-year auction back-up spill into broader financial conditions and BoE guidance?
Daily Global Economy Overview: Tuesday, September 23, 2025
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