Global Economy Briefing: October 14, 2025

Markets parsed softer U.S. small-business sentiment, stickier UK wages alongside a looser labor market, and mixed euro signals as disinflation progressed but confidence wobbled.

Asia’s picture stayed two-speed, with Korea’s trade still strong and China’s prices in mild deflation. Short-tenor funding costs eased in the U.S. and euro area.

United States

Small-business optimism slipped to 98.8 (from 100.8), hinting at cooling capex and hiring plans. Retail momentum held (Redbook 5.9% y/y).

Front-end funding eased: 3-month bills at 3.845% and 6-month at 3.685%.

Fed speakers (Bowman, Powell, Waller, Collins) were in focus as the IEA and IMF meetings framed the growth-inflation debate.

Europe & UK

Germany’s inflation was confirmed at 2.4% y/y (0.2% m/m) on both CPI and HICP; the ZEW survey was mixed—current conditions slid to −80.0 while expectations rose to 39.3, with the euro-area gauge down to 22.7.

Funding costs eased at core auctions: Germany’s 2-year Schatz at 1.910%; Italy’s 3-, 10- and 15-year BTPs cleared below prior levels (7-year ticked higher); Spain’s 3-month letras edged up to 1.918%.

In the UK, wage growth stayed elevated (ex-bonus 4.7%; total pay 5.0%), but the labor market softened—unemployment rose to 4.8%, claimant count +25.8k, and employment gains slowed.

Asia

Korea’s external engine held up (September exports +12.6% y/y; imports +8.2%; surplus $9.53B), while liquidity and money growth stayed firm (M2 up 6.8% y/y).

China’s CPI remained negative (−0.3% y/y; +0.1% m/m) and PPI ran −2.3% y/y, underscoring weak producer pricing.

Australia’s leading index was flat on the month. India’s wholesale inflation cooled further (headline WPI 0.13% y/y; food −5.22% y/y; fuel −2.58%), suggesting benign pipeline pressures.

Major Emerging Markets

Brazil’s services output rose 0.1% m/m and 2.5% y/y, slower than prior, pointing to a tempered domestic pulse.

Canada’s building permits fell 1.2% m/m, extending weakness in construction. South Africa’s business confidence improved (121.1) even as mining production slipped and gold output fell 3.6% y/y.

Commodities & Flows

The IEA report and OPEC outlooks set the tone for Q4 balances, while slightly lower core funding rates in Europe and the U.S. signaled modest easing in financial conditions.

Risks and Framing

Sticky UK pay, soft U.S. small-business sentiment, and China’s persistent price softness keep policy paths divergent.

Near-term catalysts: U.S. inflation prints, euro-area hard data, and Asia’s trade and credit signals that could reprice front ends and FX into late October.

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

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