Weekly Global Economy Overview: September 28–October 5, 2025

Global markets weighed disinflation in Europe, sticky U.S. services prices, and signs of a cautious Asia rebound across the week of September 28–October 5, 2025.

Energy dynamics stayed central as OPEC output edged higher while U.S. product inventories rose, complicating the inflation path.

Holiday-thinned Asian trading late in the week limited follow-through, leaving investors focused on next week’s U.S. labor prints and post-holiday China data.

United States

The soft-landing narrative persisted but momentum looked mixed. ISM manufacturing slipped to 49.1 (new orders 48.9) and ISM services cooled to 50.0, with prices paid elevated at 69.4.

ADP showed -32k jobs, yet pending home sales rose 4.0% m/m and GDPNow tracked Q3 at 3.8%. Dallas Fed surveys weakened, and consumer confidence eased to 94.2.

Treasury bill auctions cleared at 3-month 3.860%, 6-month 3.715%, and 52-week 3.540%.

The Fed’s balance sheet ticked down to $6.587T and reserve balances to $2.980T, while officials (Barkin, Goolsbee, Logan, Jefferson, Williams) balanced inflation vigilance with growth risks.

Europe & UK

Eurozone inflation neared target: headline CPI 2.2% y/y and core 2.3%, with unemployment at 6.3%.

Germany’s HICP ran 2.4% y/y and a Bund auction cleared at 2.72%; France posted HICP 1.1% y/y; Spain’s HICP was 3.0% y/y as confidence and industry sentiment stayed soft. PMIs showed euro manufacturing 49.8 and services 51.3.

In the UK, Q2 GDP grew 0.3% q/q (1.4% y/y) and the current account widened to -£28.9B. Nationwide house prices rose 0.5% m/m (2.2% y/y), but manufacturing PMI remained at 46.2; a 10-year gilt auction yielded 4.769%.

BoE speakers struck a cautious tone as credit conditions stayed tight and approvals were 64.7k.

Asia

China’s picture was mixed ahead of Golden Week: NBS manufacturing 49.8 and non-manufacturing 50.0 contrasted with stronger Caixin manufacturing 51.2 and services 52.9.

Japan’s data softened (industrial production -1.2% m/m; retail sales -1.1% y/y), while Tankan readings were mixed; JGB auctions saw the 10-year at 1.635% and 2-year at 0.949% as BoJ normalization talk lingered.

Korea’s external engine accelerated (exports +12.7% y/y; trade surplus $9.56B) with CPI 2.1% y/y. India kept policy settings steady; manufacturing PMI held a robust 57.7, FX reserves were $700.2B, and loan growth 10.4%.

The RBA stayed on hold at 3.60% as building approvals fell 6.0% m/m and the trade surplus shrank to 1.825B. Singapore’s PMI edged up to 50.1 and retail sales rose 5.2% y/y; Hong Kong retail sales increased 3.8% y/y.

Major Emerging Markets

Brazil’s signals were mixed: unemployment held at 5.6%; industrial production rose 0.8% m/m (-0.7% y/y); services and composite PMIs slipped to 46.3 and 46.0; CAGED showed +147k net jobs; budget metrics improved from July and FX flows were +$1.141B.

Mexico’s unemployment was 2.6% as fixed investment rose 1.6% m/m in July. South Africa’s PMI improved to 52.2, vehicle sales jumped 24.3% y/y, but the trade surplus narrowed to 3.97B.

Commodities & Flows

Oil’s backdrop tightened unevenly. OPEC production prints showed Saudi Arabia 9.85M b/d, UAE 3.35M, Iran 3.38M, Iraq 4.01M, Nigeria 1.55M. U.S. inventories rose (crude +1.79M; gasoline +4.13M), refinery utilization fell 1.6 pp, and rigs slipped (oil 422; total 549).

API signaled a crude draw (-3.674M), while EIA data pointed to product builds. U.S. natural gas storage rose 53 bcf. The mixed supply-demand signals kept inflation watchers alert and supported energy-linked FX.

Risks and Framing

Disinflation in Europe versus sticky U.S. services prices keeps policy paths divergent and curves sensitive to data surprises. A higher JGB yield trend amid BoJ normalization talk could nudge global term premia.

China’s post-holiday prints will test whether private-survey strength broadens. Energy remains a swing factor for headline CPI and real incomes.

Investors should monitor U.S. labor follow-through, ECB communication as CPI nears target, BoJ guidance, and any renewed volatility in oil and refined products.

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

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