Global Economy Briefing: December 15, 2025

Key Points

• China’s retail slumped and investment fell; industry held up. That cools global goods prices.

• India’s trade deficit shrank sharply. That eases rupee risk and regional FX stress.

• Europe’s factories rebounded. The U.S. outlook softened, but funding costs fell again.

United States

The Empire State index dropped to −3.9. Homebuilder sentiment rose to 39. Three- and six-month bills eased to 3.560% and 3.495%. That lowers dollar funding costs.

Wholesale price pressure is limited by China’s weak retail pulse and steady Korea supply.

Net read: growth is slower at the margin, but liquidity is improving.

Europe and UK

Euro area industrial production beat: +0.8% m/m and +2.0% y/y. Germany’s wholesale prices rose 0.3% m/m and 1.5% y/y. France’s short-bill auctions cleared near prior levels (12-month 2.146%).

UK housing stayed weak: Rightmove −1.8% m/m and −0.6% y/y. The UK’s drag remains real estate and external balances.

Asia-Pacific

Korea stayed strong. Exports rose 8.4% y/y, imports 1.1% y/y, with a $9.74B surplus. China disappointed on demand. Retail rose just 1.3% y/y; fixed-asset investment fell 2.6% y/y; home prices fell 2.4% y/y.

Industrial output grew 4.8% y/y, a modest cushion. Japan’s services proxy slipped (tertiary activity −0.7% m/m).

Australia’s composite PMI was 51.1. Manufacturing printed 52.2 and services 51.0. Westpac confidence fell 9.0%.

India

Wholesale inflation stayed negative at −0.32% y/y. Food rose 2.6% y/y, fuel fell 2.27% y/y, and core manufacturing was 1.33% y/y.

The trade gap narrowed to −$24.53B as exports reached $38.13B and imports fell to $62.66B. That eases external risk and gives policy room.

Latin America

Brazil’s IGP-10 was flat in December (0.0%). The IBC-Br activity proxy fell 0.20% m/m. Services cooled to 0.3% m/m and 2.2% y/y.

Peru’s trade surplus widened to $4.23B; October GDP grew 3.62% y/y and unemployment was 5.9%.

Colombia slowed: industry 1.9% y/y and retail 10.0% y/y from 14.4%. Mexico was on bank holiday.

Canada

Inflation held in the target zone. Headline was 2.2% y/y; median and trimmed were 2.8% y/y. Core fell −0.1% m/m. Manufacturing sales fell 1.0% m/m after +3.6% prior. Housing starts jumped to 254.1k.

What it means

China’s weak consumer and falling investment cool global goods prices. Korea’s surplus and India’s narrower gap stabilize Asian FX.

Europe’s output rebound hints at a floor for global manufacturing. Lower U.S. bill yields reduce dollar strain.

Positioning: keep quality duration; favor service-heavy U.S. and Asia; add selectively to euro industrials and Korean exporters; be cautious on UK housing and on Brazil until activity turns.

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