The Macro Outlook: Central Bank Previews – Fed Rate Cut Expected

by | Dec 8, 2025

The key events for w/c 8 December 2025: Central Bank Decisions: FOMC, RBA, BoC, Aus Labour Market for Nov, US data: ECI Q3, JOLTS Oct.

The Recap from Last Week – US Data Supports Risk Management Bias

The market widely expects the FOMC to deliver a further rate cut this week, despite the previous decision revealing “strongly differing views” for the Dec meeting. Despite the presence of two-sided risks and “no risk-free path” for the Fed, the risks from cooling labor market conditions have underpinned the recent decisions to ease policy. The data flow leading up to the meeting this week is still likely to support the Fed’s risk management bias, highlighting a backdrop characterized by resilient, albeit sluggish growth, stalled progress on inflation, and evidence that the labor market continues to cool and remains “susceptible to negative shocks”.

Cooling Labor Market Conditions Persist

Cooling conditions in the US labor market have been the key area of concern for the FOMC. Despite a lack of government data since the last meeting, private sector reports likely provide enough direction to maintain that risk management bias.

  • The ADP report showed another 32k jobs shed in Nov, particularly in manufacturing and professional services. This contrasted with the recent Challenger Job Cut Announcement survey, which did see a fall in Nov after the elevated number of job cuts announced in Oct.
  • The Fed will lean heavily on the most recent Beige Book survey, which showed a slight decline in employment and weaker labor demand, with firms relying on hiring freezes, attrition, and adjusted hours rather than mass layoffs.
  • The most recent initial and continuing claims data continue to normalize after the shutdown. Crucially, continuing claims have drifted lower post-shutdown, but remain at an elevated level, highlighting the susceptibility of the labor market to a negative shock.
  • The latest Nov S&P PMIs showed some resilience (employment growth steepest in three months in manufacturing and services). But this was countered by the still downbeat view of employment from the ISM surveys – especially in manufacturing.
  • The latest JOLTS data for Oct is due this week, with the full Employment Situation report for Nov to be released next week as part of the data catch-up.

Inflation Momentum Contained by Margin Compression

While lagging data suggests progress on inflation has stalled above the 2% target, more recent survey data suggests momentum may be contained by firm-level caution over pricing and competitive pressures.

  • PCE Inflation – catch-up release: The Sep report is a significantly lagging datapoint, but it did confirm the concern that inflation progress has stalled: headline PCE inflation hit a YTD high of +2.8%,  moving well above the +2.3% recorded a year ago. Core PCE edged down from its Aug YTD high to +2.8% in Sep, and is on par with the rate recorded a year ago, strengthening concerns that inflation progress has stalled.
  • The Beige Book: However, surveys suggest some weakness in pricing power. The latest Beige Book showed input prices still increased moderately and were not limited to tariffs. However, there were “multiple reports” that firms had absorbed these increases for now. The outlook for plans to raise prices in the near term was mixed.
  • The latest S&P PMIs showed manufacturing firms continued to absorb rising input prices. While services sector inflation increased to “the greatest degree since May”, increases in selling prices remained below recent peaks. The ISM surveys showed price increases remained broadly elevated, but little changed in the manufacturing sector and became less widespread in the services sector.

Activity: Downshifted but Resilient

Amidst persistent cost pressures and the government shutdown, activity has remained resilient, though downshifted to a more sluggish pace.

  • The Beige Book reported that economic activity was ‘little changed’ across most districts, noting weakness in consumer spending, resilient manufacturing activity, and “flat-to-down” revenue in the services sector.
  • The latest S&P PMIs for Nov showed growth momentum had remained broadly moderate and unchanged from Oct, as solid services sector activity helped to offset some weakness in manufacturing demand.   

Central Bank Previews – Focus on Policy Outlook

  • The FOMC: While a further rate cut is expected by the FOMC this week, the decision will be important for its signalling on the outlook. There was a notable division at the last meeting on the current policy stance, between those who thought policy was still restrictive and needed to move toward neutral and those who thought policy was “not clearly restrictive”, supporting a slower cadence of cuts. The latest projections should reflect how policymakers have shifted their views on the path of rates, as well as expectations for the economy.
  • The RBA meets this week – and is expected to keep policy settings unchanged. This will also be an important meeting, not so much for the decision, but for the parsing of recent data (firmer inflation, stronger labour market, and solid growth) and the implications for the outlook. At the last meeting, the RBA Governor noted that the recent data flow has led to increased uncertainty over the assessment that monetary policy remains a “little restrictive”. Based on the data flow since then, markets have removed rate cuts from the outlook and even started to price in the chances of a hike. The signalling in this decision will be important for the outlook.
  • Finally, the BoC will also meet this week and is expected to keep policy settings unchanged. At the last meeting, the BoC signalled that it saw its policy rate of 2.25% as “at about the right level to keep inflation close to 2%”. The latest Canadian labor market report for Nov confirmed a firming trend in employment growth, while the unemployment rate stepped notably lower from 6.9% to 6.5%.

Outlook for the week ahead: Central Bank Decisions: FOMC, RBA, BoC, Aus Labour Market for Nov, US data: ECI Q3, JOLTS Oct.

The focus shifts firmly to central bank decisions this week, including the FOMC, RBA, and BoC. While the decisions are widely expected to be clear-cut, the signalling on policy stance and the implications for the outlook will be in focus for markets.

Key factors & events to watch this week:

Key central bank decisions

US Federal Reserve meeting (FOMC)

  • Expected Action: Markets are expecting the FOMC to cut rates again this week to: 3.5% – 3.75%
  • Decision Focus: Details of the decision will be in focus – the status of the decision (still a risk management cut?), the balance of risks to the outlook (labor market versus inflation bias?), and changes to the degree of dissent/division among committee members on the policy stance compared to the previous meeting.
  • Forward Guidance: The latest Summary of Economic Projections (SEP) will be released. In focus will be any change to the cadence of policy easing as well as updates to the outlook for growth, inflation, and the labor market. Expect uncertainty to be elevated given the lack of data, effects of post-shutdown normalization on the economy, and fiscal impacts in early 2026.
  • Post-meeting speeches will also be in focus.

The Reserve Bank of Australia (RBA)

  • Expected Action: The RBA is expected to keep rates unchanged at 3.6% at its meeting this week.
  • Signalling Focus: Details of the decision will be a key focus – especially around how recent firmer data may change the Board’s view on the current policy stance (previously, “increased uncertainty” over whether policy was a “little restrictive”).
  • Domestic Data: The Nov labour market survey is expected to show continued growth in employment of +20k, down from +42k in Oct. The unemployment rate is expected to edge back up to 4.4% from 4.3% in Oct.

The Bank of Canada (BoC)

  • Expected Action: The BoC is expected to keep policy settings unchanged at this meeting at 2.25%.

US labor market data

  • Ahead of the release next week of the up-to-date Employment Situation report for Nov, the latest JOLTS data for Oct will be released this week. Job openings for Oct are expected to be 7.2m in Oct, little changed from 7.22m in Sep. This report will provide our first read on any shift to the low-hiring/low-firing dynamic of the US labor market.
  • Initial jobless claims for the wk ending 6 Dec are expected to increase slightly to 221k from 191k wk ending 29 Nov, which reflected the short week for Thanksgiving. The trend of continuing claims will be in focus for the wk ending 29 Nov, given the recent downshift post-shutdown.
  • Data catch-up: US Employment Cost Index Q3: QoQ expecting +0.9%, unchanged from +0.9% in Q2.
  • The catch-up international trade data for Sept will be released this week (BEA), with the release of the initial estimate of US Q3 GDP growth pushed out to 23 Dec.

Updated US data release schedules

  • Link to the BLS page for the revised news release is here.
  • The Bureau of Economic Analysis (BEA) schedule page can be found here.
  • The US Census Bureau page can be found here.

This week, the US Treasury will auction and settle approx $502bn in ST Bills, with a net paydown of $38bn. The US Treasury will also auction the 30-year Bond, 3-year, and 10-year Notes this week – all will settle next week on 15 Dec.

Approx $11bn in ST Bills will mature on the Fed balance sheet and will be reinvested.

More detail (including a calendar of key data releases) is provided in the briefing document – download the pdf below:

Weekly Macro Outlook – 8Dec2025Download

Comments and feedback are welcome. Please email me at kim.mofardin@marscapitalpartners.net

The Macro Outlook: The US Data Challenge and the Case for a Risk Management Cut

by | Dec 1, 2025

The key events shaping the w/c 1 December 2025: Fed Chair Powell speech, ISM PMIs, Global S&P PMIs, catch-up US data: personal spending, income & PCE inflation for Sep.

The Recap from Last Week

At its meeting next week, the Fed faces the challenge of assessing a still incomplete set of data while disentangling the shutdown’s noise from the underlying signal of economic activity. While the end of the government shutdown suggests a rebound in activity is expected, the underlying narrative from last week’s US data was negative: sluggish activity, pockets of inflation, weakening sentiment, and continued cooling in the labor market. For the Fed, this confluence of distorted data and negative underlying signals likely builds the case for another risk management cut. Market pricing is now clearly reflecting an increased probability of a cut next week.

Surveys & Data – Sluggish Activity

The Fed’s Beige Book provided a broad backdrop of sluggish activity over the last six weeks. The report noted that most Fed districts had recorded little change in economic activity since the last report (reported before the Oct FOMC meeting). Overall retail spending had declined further, reflecting some cautious discretionary spending. Some districts noted a negative impact on consumers from the government shutdown, and community organizations saw increased demand for food assistance due to disrupted benefits during the shutdown. Furthermore, the catch-up retail sales report for Sep showed nominal retail sales growth had already slowed leading into the government shutdown, with real retail sales falling in the month.

The Beige Book reported some optimism among manufacturers in the outlook. However, this optimism was countered by the two regional activity surveys for Chicago and Dallas, which showed manufacturing activity had slipped further into contraction in Nov. The Beige Book also reported that “revenues in the nonfinancial services sector were mostly flat to down” – a finding that contrasts with the more recent services PMI reports.

Input Price Inflation Persisted

The absence of official government inflation data leading up to the next Fed meeting has complicated the assessment of the dual mandate risks. Nevertheless, the Beige Book highlighted widespread rising input prices affecting both retail and manufacturing firms. While some of these costs were tariff-related, firms also cited rising prices for insurance, utilities, technology, and healthcare. These inflationary impulses seemed to be countered by a lack of firms’ pricing power. Although firms expect “upward cost pressures to persist,” plans to raise prices in the near-term were mixed. Critically, “margin compression” was noted multiple times, indicating that the extent of pass-through of these higher input costs was limited by competitive pressures, demand, and client pushback.

Sentiment Weakened

The sluggish activity and cautious outlook of firms in the Beige Book was mirrored by the Conference Board Consumer Confidence survey for Nov. The headline measures of confidence all fell in Nov, with the report reflecting ongoing consumer concerns over inflation, tariffs, and politics, with an increase in mentions of the government shutdown. Since the survey cut-off was just days after the shutdown ended, some rebound in sentiment is possible in the Dec report.

Aside from the temporary nature of the shutdown concern, there were enduring themes leading to weaker sentiment in Nov. The report highlighted weakening labor market conditions (with another fall in the key labor market differential), weakening expectations in the outlook for the labor market and household income, and enduring concerns related to prices, inflation, and tariffs in the write-in responses.

Weakening Labor Market Conditions

For the Fed, one of the more important insights concerns weakening labor market conditions. At this stage, this factor is likely to influence the Fed’s decision calculus regarding another risk management cut to a greater degree than the persistence of inflation.

The Beige Book clearly highlighted that employment had declined, albeit slightly, during the inter-meeting period. The labor market dynamic still seemed little changed from the recent low/cautious hiring, but low firing environment, despite the recent increase in layoff announcements. Firms have adapted to the more sluggish and uncertain conditions by adjusting hours worked and managing headcount via hiring freezes, attrition, and replacement-only appointments.

This low-hiring/low-firing dynamic is also still reflected in the most recent initial and continuing claims data, though the latter remains distorted by the government shutdown. Initial claims have continued to ease, including a notable slowdown in initial claims from Federal government employees. At the same time, continuing claims have remained elevated, near cycle highs, keeping the labor market susceptible to a negative shock. The latest week of data for continuing claims (wk ending 15 Nov) still reflects the government shutdown and includes a notable number of furloughed Federal workers, which should begin to revert after next week’s report.

Outside of the US

The inaugural Aus monthly CPI for Oct came in higher than expected – and continued to reinforce the RBA’s on-hold status. Headline CPI increased by +3.9% in Oct, up from +3.6%, while the trimmed mean inflation rate increased by +3.3% in Oct, also up from +3.2% in Sept.

The Tokyo CPI remained firm for Nov (a leading indicator for the National CPI in Nov), while retail spending growth and industrial production also increased.

The RBNZ cut rates by 25bps as expected. The decision highlighted that a further cut would help support an enduring recovery, underpin consumer and business confidence, and still meet the inflation goal. The outgoing head of the RBNZ noted that there was now a “high hurdle” for further rate cuts (source: Bloomberg)  

Outlook for the week ahead: Fed Chair Powell speech, ISM PMIs, Global S&P PMIs, catch-up US data: personal spending, income & PCE inflation for Sep.

The week ahead will continue to focus on the catch-up of US data. One of the key reports will be the US PCE inflation data for Sep as a part of the personal spending and income report. While a lagging report, its importance is heightened because consistent inflation data has largely been absent from the broader economic narrative over the last six weeks. Amid the focus on weakening activity and a cooling labor market, the inflation side of the dual mandate has felt like a missing piece of the assessment. Other US catch-up reports for Sep will include factory orders and import/export prices.

This would usually have been the week for official US jobs data; however, the updated Employment Situation data is still several weeks away. This week, we will instead receive the monthly ADP as well as the Challenger Job Cut Announcements for Nov. Other US reports that will be in focus this week will be the ISM surveys for Nov.

Key factors & events to watch this week:

US Fed Chair “brief remarks” within the blackout period

  • There are several speeches noted in the official calendar despite this being the blackout period ahead of the Fed meeting next week – see the official Fed calendar.
  • Fed Chair Powell is expected to give “brief remarks” and take part in a panel discussion. It’s unlikely he’ll cover the economic outlook given the blackout conditions.
  • Vice Chair (Supervision), Bowman, will also give testimony this week.

US catch-up data and partial Nov labor market data

  • Data catch-up: US headline PCE inflation for Sep is expected to increase by +0.3% over the month, up slightly from +0.26% in Aug. The annual rate is expected to increase to +2.8% from +2.7% in Aug. Core PCE inflation is expected to increase by +0.2% over the month, unchanged from Aug. The annual core PCE inflation rate is expected to remain unchanged at +2.9% in Sep.  
  • Data catch-up: Personal income is expected to increase by +0.4% in Sep, unchanged from +0.4% in Aug. Personal spending is expected to increase by +0.2% in Sep, down from +0.6% in Aug.
  • Data catch-up: Factory Orders for Sep are expected to increase by +0.2%, down from +1.4% in Aug.
  • Data catch-up: US import and export prices for Sep.
  • The ISM PMIs: the headline manufacturing PMI is expected to be little changed at 48.6, while the services PMI is expected to slow slightly to 52.1.
  • US labor market data: the ADP monthly employment change is expected to slow to +20k in Nov, from +42k in Oct. The Challenger Job Cut Announcement survey for Nov is expected to fall after the notable increase to 153k in Oct.
  • Initial jobless claims for the wk ending 29 Nov are expected to remain little changed at 218k, after falling to 216k in the prior week. The continuing claims will be in focus for the wk ending 22 Nov – and could start to see furloughed Federal workers roll off the claims data. Continuing claims came in at 1.960m in the week ending 15 Nov.
  • Michigan Consumer Sentiment – the prelim read for Dec should highlight the degree of any rebound from the end of the government shutdown.

Updated US data release schedules

  • Link to the BLS page for the revised news release is here.
  • The Bureau of Economic Analysis (BEA) schedule page can be found here.
  • The US Census Bureau page can be found here.

European inflation and growth data

  • The prelim Euro area CPI for Nov is expected to firm. Headline CPI is expected to increase to +2.2% in Nov, up from +2.1% in Oct. Core CPI is also expected to increase to +2.5% in Nov, up from +2.4% in Oct.
  • Euro area GDP for Q3 is expected to be confirmed at +0.2% over the quarter, and employment growth at +0.1% over the quarter.

Canada’s labour market survey for Nov is expected to show stalled employment growth of -7k after a notable increase of +66k in Oct. The unemployment rate is expected to tick higher to 7% in Nov from 6.9% in Oct.

Australian GDP for Q3 is expected to increase by +0.7% over the quarter (QoQ), up from +0.6% in Q2.

The full suite of global S&P PMIs for Nov will be released this week, providing an update on activity and momentum midway through Q4.

This week, the US Treasury will auction and settle approx $691bn in ST Bills, Notes, and Bonds, raising approx. $66bn in new money.

QT this week: Approx $30bn in ST Bills, Notes, and Bonds will mature on the Fed balance sheet and will be reinvested. Approx $2.7bn in Notes and Bonds will mature on the Fed balance sheet and be redeemed (from Nov). The QT program will end as of 1 Dec.

More detail (including a calendar of key data releases) is provided in the briefing document – download the pdf below:

Weekly Macro Outlook – 1Dec2025Download

Comments and feedback are welcome. Please email me at kim.mofardin@marscapitalpartners.net

The Macro Outlook: Fed Dual Mandate Risks

by | Nov 24, 2025

The key events shaping the w/c 24 November 2025: US retail sales and PPI catch-up data for Sept, US Thanksgiving Holiday, Aus CPI, and RBNZ meeting

The Recap from Last Week: FOMC Minutes and the Catch-Up US Employment Data for Sept

FOMC Minutes – Risk Framing

The FOMC minutes confirmed the risk management nature of the October rate cut – based on the judgment of rising downside risks to employment, leaving “the labor market more susceptible to any negative shock”. This appeared to be a broadly supported decision (minus two dissents) as ‘most’ participants suggested the cut would help “to forestall the possibility of a major deterioration in labor market conditions”. However, there were still ‘some’ participants who noted that they could have supported a decision to stay on hold at this meeting also.

A key development was the divided outlook on the Dec meeting and the risks around a third consecutive rate cut. The minutes revealed the nature of that division along several lines, including the degree of policy restriction and risks around inflation. It’s worth noting that ‘most’ participants were pro-rate cuts “over time”, but it was a question of the cadence of those cuts, with ‘several’ of those participants noting a further cut as “not likely” appropriate in Dec.

The pro-hold camp noted concerns that inflation progress had stalled above the 2% target, while the policy stance was “not clearly restrictive”. They were concerned that a further reduction could add to the risk that still above-target inflation could “become entrenched” or the risk that another follow-up cut could signal a lack of policymaker commitment to the 2% target.

The pro-cut camp believes that the policy stance is still restrictive, even after the cut in Oct, and that further easing is needed to move towards a more ‘neutral’ policy stance to ensure against further downside risks to employment and aligning with the risk management or insurance cut rationale. This group believes that underlying inflation, removing tariff effects, is close to the 2% target, giving the Fed room to ease.

The immediate challenge for the Fed’s Dec meeting will still be a lack of US federal government data to help inform the assessment of the balance of risks.

The Missing US Data Hurdle & Policy Rhetoric

It was announced last week that the Oct jobs report would not be released and that data would be rolled into the Nov report, to be released on 16 December – six days after the Dec FOMC meeting. Market expectations for a cut in Dec fell notably after that announcement (assuming the Fed would take a cautious approach and stay on hold). More timely inflation data will also be delayed.

However, speeches last week emphasised that, despite the lack of government data, the Fed is not flying blind. This point was made in several speeches last week, including by Governor Waller early last week. Gov. Waller’s speech was made before the catch-up release of the US Employment data for Sept. He clearly supports another cut in Dec, “as a matter of risk management,” given that the labor market remains at stall speed. He believes policy is restrictive and is weighing on the economy, and a further cut in Dec will ensure against an acceleration in the weakening labor market. Fed Vice Chair Jefferson was a little more non-committal in his outlook. He also spoke about other useful data sources for the Fed and specifically mentioned the Fed Beige Book due out this week. He believed the policy stance is “somewhat restrictive”, but has moved closer to its neutral level. He emphasized the need to “proceed slowly as we approach the neutral rate”. Later in the week, the speech by NY Fed President Williams was credited as the reason for a subsequent increase in rate-cut odds at the Dec meeting. He views monetary policy as still “modestly restrictive”, although somewhat less so after recent cuts, but still sees room for further adjustment “in the near term” to move the policy stance closer to the neutral range.

By the end of the week, rate cut odds had moved up from a 50-50 chance at the start of the week to approx. 70-30 in favour of a cut at Dec (Source: CME FedWatch Tool). This will continue to be a fluid situation.

Data to Assess the Balance of Risks

The catch-up US Employment Situation report for Sept delivered mixed messages, but its overall composition likely fails to negate the rising downside risks noted at the Fed’s Oct meeting. The unemployment rate increased notably to 4.4% (+0.12%pts in the month), yet this rise was not due to falling employment. Employment growth was positive, albeit modest, over Aug and Sept. The employment to population ratio for both 16yrs+ and the core working age group remained steady and elevated, also confirming a still low firing environment. The rise in unemployment over Aug and Sept was due to labor supply, including an increase in participation, growing at a faster pace than employment growth. Notwithstanding the stronger NFP print in Sept of +119k, this supply/demand imbalance, resulting in higher unemployment, is where the labor market risks remain.

More recent labor market signals also suggest that underlying risks remain. Up-to-date continuing claims data has moved back up to cycle highs, but is not providing a clear signal as it includes an elevated number of federal workers on furlough. While this rise may not signal a cyclical downturn, we still end up in the same place: labor market conditions that remain susceptible to a downturn. When layering on the rising Challenger job cuts announced in Oct, the overall picture suggests US labor market conditions may not have materially improved since Sept, but rather steadied at an elevated risk level.

On the activity front, the more recent news was still one of resilience. The most recent US prelim PMI for Nov shows some modest to moderate growth momentum. However, risks remain in the manufacturing sector, while services momentum remains moderate. US existing home sales remained steady at around 4.1m in Oct, while home builder sentiment remained little changed at subdued levels. Headline consumer sentiment in the Michigan survey fell within the margin of error, but sentiment around current conditions fell more notably amid “persistent high prices and weakening incomes” (source: Michigan Survey).

Global Signals on Inflation

The picture from global CPI reports was also mixed, with better news on inflation for both Canada and the UK. Canada’s lower-than-expected headline and underlying CPI for Oct confirmed the latest BoC comments on inflation that “upward momentum has dissipated.” The UK CPI was also lower than expected across headline, core, and services measures – also supporting the BoE assertion that inflation was deemed to have peaked. Inflation in Japan, however, is proving to be more persistent with headline and core measures moving back up to +3% in Oct.

Outlook for the week ahead: US retail sales & PPI catch-up data for Sept, US Thanksgiving Holiday, Aus CPI, and RBNZ meeting

The week ahead continues to focus on the catch-up of delayed US government data, specifically Sept retail sales and PPI, ahead of the Fed meeting on 10 Dec. A crucial hurdle for the Dec meeting will be the lack of up-to-date government inflation figures. Consequently, the Fed will rely heavily on anecdotal indicators like the Fed Beige Book, private sector reports, as well as some limited government data such as weekly Initial/Continuing Claims to frame its assessment of the balance of risks. This is the last week for Fed officials to offer policy guidance before the pre-meeting blackout period begins next week. Globally, watch for the Aus monthly CPI and the RBNZ policy decision.

It’s also a short week in the US with the Thanksgiving Holiday.

Key factors & events to watch this week:

US Federal Reserve speeches & data

  • There are no official Fed speeches scheduled for this shortened week – see the official Fed calendar. Next week will be the blackout week for speeches ahead of the 10 Dec meeting.
  • There will be one key Fed release this week – the Beige Book of anecdotes from regional contacts for the last six weeks. This will cover activity, prices, and labor market conditions. Last week, Fed Vice Chair Jefferson specifically noted this as a key release to watch in the absence of US government data.

US Data

  • Data catch-up: US retail sales for Sept are expected to increase by +0.4% over the month versus +0.6% in Aug. The control group retail sales (what feeds into GDP expenditure) is expected to slow to +0.3% over the month from +0.7% in Aug.
  • Data catch-up: US headline PPI for Sep is expected to increase by +0.3% over the month, up from -0.1% in Aug. Over the year, headline PPI is expected to increase to +2.7%, up from +2.6% in Aug.
  • Data catch-up: Durable Goods orders Sept are expected to increase by +0.2% over the month, from +2.9% in Aug
  • The Conference Board Consumer Confidence Index for Nov is expected to edge lower to 93.4 from 94.6.
  • Initial jobless claims for the wk ending 22 Nov are expected to remain around the 220k level.

Updated US data release schedules

  • Link to the BLS page for the revised news release is here.
  • The Bureau of Economic Analysis (BEA) schedule page can be found here. The US Q3 GDP report, which was originally slated for release this week, will be rescheduled. There is also no date yet on the PCE inflation report for Sept, though the catch-up PPI for Sept is only being released this week.
  • The US Census Bureau has yet to update its schedule, but the page can be found here.

Aus monthly CPI for Oct – this will be the first release of the full monthly inflation report. For now, though, the RBA will continue to focus on the quarterly data. The headline CPI is expected to increase by +3.5% over the year in Oct, unchanged from +3.5% in Sept. The monthly trimmed mean inflation is expected to increase to +3% in Oct, up from +2.8% in Sept.

The RBNZ will meet this week and is expected to deliver another 25bps rate cut.

The UK government budget is scheduled for release this week on 26 Nov. The budget is expected to contain measures that could impact the BoE’s decision-making, which was anticipated at its last meeting. That recent BoE decision was extremely divided, resulting in a 5-4 vote in favor of a pause while the committee awaited more economic evidence and the details of the budget measures.

This week, the US Treasury will auction and settle approx. $619bn in ST Bills, TIPS, and FRNs, raising approx. $66bn in new money. The US Treasury will also auction the 2-year, 5-year, and 7-year Notes early this week – and all will settle on 1 Dec, next week.

QT this week: Approx $14.5bn in ST Bills will mature on the Fed balance sheet and will be reinvested.

More detail (including a calendar of key data releases) is provided in the briefing document – download the pdf below:

Weekly Macro Outlook – 24Nov2025Download

Comments and feedback are welcome. Please email me at kim.mofardin@marscapitalpartners.net

The Macro Outlook: Delayed US Jobs Data & a Divided Fed

by | Nov 17, 2025

The key events shaping the w/c 17 November 2025: FOMC Minutes & Speeches, US Employment Situation for Sept, Prelim PMIs Nov, global CPI reports

Recap from last week: Data Catch-Up Begins

The US government shutdown has officially ended, shifting the focus from political gridlock to the messy process of data catch-up. The first major release confirmed by the BLS is the Sept Employment Situation Report, due late this week, which is important, but now a significantly lagging report.

This will also put the spotlight squarely back on the incoming economic releases, potentially enabling the Fed to address its internal division on the policy outlook. This week, timely, yet soft, data points may contrast with the “stale” US catch-up data, but could start to provide some direction for the Fed ahead of Dec.

US Activity and the Data Vacuum

Last week was a particularly quiet week for any US economic data. The NFIB small business optimism index for Oct was consistent with several other business surveys showing some weakening in optimism in the outlook. Small business optimism fell slightly in Oct – reflecting reports of “lower sales and reduced profits”. However, the uncertainty index fell notably, to its lowest level of the year.

Preliminary private sector labor data suggested a weakening in job growth through the latter part of Oct. The new weekly ADP payrolls series (The NER Pulse) shows the preliminary estimate of the week-over-week change in employment based on a four-week moving average. This week’s data reflects the week ending 25 Oct and shows the change in the 4-weekly average at -11k for private job creation. This preliminary data is two weeks advanced from the prior monthly ADP report (+42k) and suggests job creation may have slowed.

In a separate policy development, the ongoing impact of inflation on households and consumer sentiment appears to have registered with the US government. Late last week, an announcement was made to reduce tariffs on key imported food items and implement other measures aimed at addressing consumer inflation (source: Bloomberg).

Policy Implications: The Divided FOMC

Fed speeches from some of the more hawkish members underscored the division within the FOMC ahead of their next meeting, reinforcing the importance of the incoming data catch-up. Boston Fed President Collins, though supporting the Oct cut as “prudent,” is comfortable being on hold in Dec, citing the risk that “providing further monetary support risks slowing or stalling the return of inflation to target” (source: Bloomberg). Conversely, Kansas City Fed President Schmid (an Oct dissenter) argued that further cuts are unlikely to fix structural labor market issues but could jeopardize the 2% inflation objective.

At this point, rate cut probabilities reflect the divided Fed, with now only approximately a 50% probability of a cut priced in for Dec (source: CME FedWatch). This is a highly fluid situation, and forthcoming data and Fed speeches from some of the doves this week could easily shift these probabilities again.

Global Central Banks and Data Implications

Outside of the US, key data releases in Aus and the UK offered fresh insights following their recent respective central bank meetings.

In Aus, the Oct labour market report was solid, reversing some of the recent increase in the unemployment rate. Employment growth increased, while participation stayed unchanged (after notably rising last month), causing the unemployment rate to fall back to 4.3%. For the RBA, this strong report, coupled with easing financial conditions and a lift in mortgage commitments, and the recent return of underlying inflation to above the target band, casts further doubt over whether policy is still “a little restrictive.” Market pricing currently reflects the likelihood of an extended pause.

Meanwhile, the UK labor market continued to show signs of slowing, with both the employment rate falling and the unemployment rate rising to 5.0%, alongside slower wage growth. GDP growth also decelerated more than expected, slowing to +0.1% in Q3 (from +0.3% in Q2). These slowing growth and labor market metrics play directly into concerns over slack building in the UK economy, supporting the dovish case for a rate cut at the last BoE meeting. However, the immediate focus remains on next week’s (26 Nov) UK budget measures.

Outlook for the week ahead: FOMC Minutes & Speeches, US Employment Situation for Sept, Prelim PMIs Nov, global CPI data

The focus this week is on a mix of data catch-up and a busy week of current data releases and US Fed speeches. US statistical agencies will provide broader guidance on when and how the official US government data flow will normalize. Crucially, the recommencement of US data releases begins this week with the important, albeit lagging, Sept Employment Situation Report (expected Thursday). This will contrast with a busy calendar of timelier (albeit softer) US data releases, as well as the FOMC minutes, a notable number of Fed speeches, the S&P preliminary PMIs for Nov, and global CPI reports.

Key factors & events to watch this week:

Updated US data release schedules.

  • So far, we have confirmation from the Bureau of Labor Statistics (BLS) of two reports this week: The Employment Situation for Sept – this will be released on Thursday, 20 Nov. The second is Real Earnings for Sept – to be released on Friday, 21 Nov.
  • Link to the BLS page for the revised news release is here.
  • The Bureau of Economic Analysis (BEA) will release the Aug International Trade in Goods & Services this week. The schedule will continue to be updated, and its page can be found here. So far, there is no update on a PCE inflation data due date.
  • The US Census Bureau has yet to update its schedule, but the page can be found here.

US Federal Reserve: Minutes & Speeches.

The focus of speeches remains on the division among FOMC members about the policy outlook for Dec.

  • The FOMC minutes of the Oct meeting will be released this week. While the Oct decision to cut was broadly consensus (two dissents), the outlook for Dec reflected ”strongly differing views”. The minutes should provide some insight into the discussion for the short-term policy outlook, as well as the decision to end QT.
  • There will be numerous Fed speeches through the week – see the official Fed calendar. There are two key speeches this week that will focus on ‘the economic outlook’ – with at least one of those speeches likely to support a more dovish outlook for Dec. Fed Vice Chair Jefferson and Fed Governor Waller will both give speeches on the ‘economic outlook’ this week – though these two speeches are not likely to incorporate any updated data.

US Data

Private sector reports for housing, Fed manufacturing surveys for Nov, and the US employment situation for Sept.

  • The Employment Situation for Sept – this will be released on Thursday, 20 Nov. There are no estimates for the release. For comparison: the last payroll change for Aug was +22k, while the unemployment rate had edged up to 4.32% from 4.25%. The market will be parsing this report not just for the Sept context, but for any directional clues it might offer for the outlook.
  • Also part of the data catch-up will be: Real Earnings for Sept and International Trade for Aug.
  • Initial jobless claims for the wk ending 15 Nov are a TBC from the Dept of Labor.
  • Housing data will be a combination of existing home sales (expecting 4.06m annualized in Oct) and home builder sentiment (NAHB Housing Market Index).
  • There will be a range of US Fed Manufacturing Surveys for Nov – providing the first view of manufacturing activity mid-way through Q4.
  • This will be supplemented by the release this week of the S&P prelim PMIs for Nov. One of the key points from the PMIs last month was the notable downshift in optimism in the outlook for Oct – so it will be important to see if this resolved.
  • The final Michigan Consumer Sentiment for Nov will also be important to see whether sentiment rebounded; however, it’s likely to be too early to see a broad impact from the resolution of the shutdown.

Global CPI Reports – Oct

  • UK CPI for Oct is expected to be 0% over the month, after 0% in Sep. The annual rate is expected to ease slightly from last month’s +3.8% rate. Core inflation is expected to ease to +3.4% in Oct from +3.5% in Sept. The services inflation rate will also be in focus – and is expected to be little changed again at +4.7%.
  • Canada CPI for Oct is expected to increase by +0.2% over the month, up from +0.1% in Sept. The annual rate is expected to be little changed at +2.4%. Measures of core inflation are expected to ease. Trimmed mean inflation is expected to increase by +3% over the year in Oct, down from +3.1% in Sept, while the median CPI is expected to increase by +3.1% in Oct, down from +3.2% in Sept.
  • The focus of Japan’s National CPI for Oct will be the key BoJ core CPI measure ex fresh food, which is expected to accelerate slightly to +3% in Oct from +2.9% in Sept. The earlier Tokyo CPI inflation for Oct had been a little hotter over the month across all headline measures.
  • Euro area – final for Oct is expected to confirm headline inflation at +2.1% and core inflation at +2.4% over the year.

Aus – Wages and RBA Minutes

  • The latest RBA Minutes will be released this week. While the decision to stay on hold was unanimous, the minutes may provide insight into the discussion around how restrictive policy settings are, as well as the rationale for the change in guidance to include “in both directions”.
  • The Wage Price Index for Q3 is expected to increase by +0.8% over the quarter and remain unchanged at +3.4% over the year.

S&P Prelim PMIs for Nov.

S&P Prelim PMIs for Nov will be released for key developed markets. There were several themes and similarities in the reports in Oct – weakening global demand, especially across manufacturing sectors, and weaker sentiment in the outlook.

This week, the US Treasury will auction and settle approx. $657bn in ST Bills, Notes, and Bonds, raising approx. $59bn in new money. The US Treasury will also auction the 10-year TIPS and 20-year Bond – both will settle at the end of the month.

QT this week: Approx $33bn in ST Bills, Notes, and Bonds will mature on the Fed balance sheet and will be reinvested. Approx $2.3bn in Notes & Bonds will mature and be redeemed and roll off the Fed balance sheet.

More detail (including a calendar of key data releases) is provided in the briefing document – download the pdf below:

Weekly Macro Outlook – 17Nov2025Download

Comments and feedback are welcome. Please email me at kim.mofardin@marscapitalpartners.net

The Macro Outlook: US Government Shutdown Nearing the End

by | Nov 10, 2025

The key events shaping the w/c 10 November 2025: Veterans Day, resolution on the US government shutdown, UK & Aus labour market reports, Euro area & UK GDP Q3

Recap from last week: Resilience Undermined by Policy Uncertainty in Oct

Momentum in the US economy remains difficult to assess, as we continue to rely almost exclusively on private sector surveys and data due to the government shutdown. Though at the time of writing, there are reports of a potential stopgap funding agreement that could see the longest US government shutdown end this week (source: Bloomberg).

The data we received last week reflected activity that remained surprisingly resilient, while sentiment became more pessimistic due to policy uncertainty. The US PMI survey data for Oct reflected still solid activity, but the outlook was undermined by elevated caution. Similarly, US consumer sentiment fell sharply again at the start of Nov amid shutdown concerns. The limited and mixed US data will likely remain a challenge for the FOMC as it grapples with the risks to its dual mandate. Last week, private sector data suggested little aggregate change in labor market conditions in Oct but highlighted pockets of weakness. Globally, both the Bank of England (BoE) and the Reserve Bank of Australia (RBA) kept policy unchanged, with both central banks signalling heightened uncertainty – but for structurally different reasons.

US Activity Tempered by Caution

The US headline PMIs mostly indicated a solid start to activity in Q4. The S&P PMIs showed moderate expansion in manufacturing and services, led by output and demand. Domestic activity led the way, while export demand remained in contraction. Finance and tech sectors were key drivers of the expansion, but reports noted signs of improving consumer demand. A question remains over the durability of manufacturing output growth, though, given the large increase in finished goods inventories. The price indexes still showed persistent inflation pressures, but provided little guidance on the magnitude of the pressures.

The stronger, unifying theme of the PMI surveys was the weaker/falling sentiment, citing trade policy (tariffs), political uncertainty (federal shutdown), and generally “mixed signals” from the economy. Reports suggested that weakening sentiment due to policy and political uncertainty during Oct (namely, the US-China trade flare-up and US government shutdown) may have held back activity and muddied the outlook for firms.

Consumer Sentiment: A Reaction to Policy

This pervasive uncertainty was clearly reflected in the prelim Michigan consumer sentiment survey for Nov. All three headline measures fell notably at the start of Nov, building on weaker readings from the two prior months. Declines in both the outlook and current conditions were widespread among consumers, citing “worries about the potential negative consequences of the ongoing federal government shutdown”. Importantly, since these primary sources of increased uncertainty are unlikely to be enduring, sentiment could rebound once the shutdown is resolved.

Labor Market Data Gap Challenges the FOMC

Ordinarily, this would have been the week for the Oct payrolls report. The absence of the US government data is particularly crucial now, as the FOMC continues to grapple with opposing risks to its dual mandate and internal division on the near-term policy path. Last week’s private sector data reflected some mixed signals on the US labor market, but little to suggest a material change from the cooling conditions. The PMI surveys showed little change in employment momentum across manufacturing and services, with some reports noting that the heightened uncertainty held back decisions on hiring in Oct. Conversely, the ADP payroll report recorded a stronger-than-expected increase in Oct at +42k (expecting +25k) – breaking a series of weaker payroll reports. Layoffs were mixed: the Challenger Job Cut Announcement survey recorded a notable increase in layoff announcements to 153k in Oct from 54k in Sept. The increase in layoffs in Oct was led mostly by ‘warehousing’ (UPS announcements), and technology. However, the technology job cuts (+33k) were offset by a notable increase in technology hiring announcements (+250k). Over the YTD, DOGE is still the largest contributor to job cut announcements. While the “DOGE” cuts are not a cyclical indicator, more cyclically related “cost-cutting” was cited as the top reason for layoff announcements this month.

US Fed speeches last week acknowledged the challenge of navigating the current environment with limited data. Fed Governor Cook supported the decision to cut at the last meeting, noting that she believed downside risks to the labor market were greater than the upside risks to inflation, and assessed policy as still ‘modestly’ restrictive. Meanwhile, Fed Vice Chair Jefferson indicated that the recent lack of progress on inflation might be due to “tariff effects,” and suggested underlying inflation may still be making progress toward 2%. He assessed policy as only ‘somewhat’ restrictive and agreed that it makes sense to ‘proceed carefully’ now as the Committee approaches the neutral rate.

Global Central Banks: Pause Amid Uncertainty

Caution and uncertainty were also themes reflected in the two key central bank decisions last week – but for different, structural reasons.

The RBA kept policy settings unchanged as expected, and the decision was unanimous. The recent higher-than-expected inflation, recovery in demand, still tight labour market conditions, and easing in financial conditions have now increased the uncertainty over the assessment that monetary policy remains a “little restrictive”. Guidance was further adjusted to now reflect a ”heightened level of uncertainty about the outlook in both directions”. The Governor suggested that the RBA “may cut rates, or we may not”. New forecasts for underlying inflation show the trimmed mean remaining above the target band through to H2 2026 – suggesting an extended pause is possible if data evolve as per the forecasts.

The BoE also kept policy unchanged, but it was an extremely divided 5-4 decision, with four members voting for a 25bps cut. Risks of greater inflation persistence have become less pronounced recently, while the risk to medium-term inflation from weaker demand has become more apparent (concerns over slack building in the economy) –  such that these risks are now more balanced. Amid the voter split, the Committee agreed on “waiting for additional evidence before reducing Bank Rate further”. While settings were deemed as ‘restrictive’, the internal division highlighted different views on the degree of restrictiveness. The decision noted that inflation was deemed to have peaked – an important signal for the outlook on rates. The extent of further cuts will depend on the inflation outlook – as disinflation continues, restrictiveness will be removed.

Outlook for the week ahead: Awaiting Shutdown Resolution

The expected resolution of the US government shutdown this week will see a shift from political gridlock. While the immediate policy risk of the shutdown may be receding, market participants must now brace for the uncertainty of when and how the official data flow will normalize – and importantly, what the data will say.

Assuming the shutdown ends this week, we’ll await guidance from statistical agencies over the timeline for scheduled releases.

For the immediate week, the US economic calendar remains minimal, keeping private sector surveys in focus. Outside of the US, key data releases in the UK and Aus will serve as essential validation (or challenge) to the recent policy decisions by the BoE and the RBA.

Tuesday, 11 Nov is Veterans Day.

Key factors & events to watch this week:

US Government Shutdown

Resolution of the US government shutdown and the resulting schedule of data releases.

US Data

Private sector reports are still in focus for this week, but will offer little further insight into the near-term outlook.

  • NFIB Small Business Optimism Index will gauge sentiment in the small business sector, which, as highlighted in Part 1, may have been dampened by policy uncertainty in Oct and early Nov.
  • The ADP preliminary 4-weekly payroll change will be updated now each week on a Tuesday. The prior 4-weekly change at the week ending 11 Oct was +14k. The note from ADP on the new release is here.
  • If the shutdown ends early in the week, the initial jobless claims series could be released this week.
  • There will be numerous Fed speeches through the week – see the official Fed calendar. Fed Governor Waller is scheduled to speak this week on “Payments” at a Fintech conference hosted by the Philadelphia Fed.

UK data

  • UK labour market data for the 3-months ending Sept is expected to see the unemployment rate edge higher to 4.9% – this may not allay concerns over slack building in the economy.
  • GDP for Q3 is expected to edge down to +0.2% QoQ, from a modest +0.3% in Q2.

Australian Labour Market for Oct

  • Employment growth is expected to edge higher to +20k from +15k in Sept. The unemployment rate is expected to fall to 4.4% from 4.5% in Sept. This may also support the assertion that some tightness remains in the labor market.

Euro Area Data

Euro area GDP growth for Q3 is expected to be confirmed at +0.2%.

China Activity Data

The remaining activity data from China will be released this week. This comes on the heels of the step down in Chinese export and import growth in Oct. The activity data is expected to moderate slightly, with retail sales slowing to +2.8% in Oct from +3% in Sept and industrial production slowing to +5.5% from +6.5% in Sept.

This week, the US Treasury will auction and settle approx. $532bn in ST Bills, raising approx. $37bn in new money. The US Treasury will also auction the 3-year and 10-year Notes, and the 30-year Bond this week – they will settle early next week.

QT this week: Approx $17.2bn in ST Bills will mature on the Fed balance sheet and will be reinvested.

More detail (including a calendar of key data releases) is provided in the briefing document – download the pdf below:

Weekly Macro Outlook – 10Nov2025Download

Comments and feedback are welcome. Please email me at kim.mofardin@marscapitalpartners.net

The Macro Outlook: A Divided FOMC and the US Labor Market

by | Nov 3, 2025

The key events shaping the w/c 3 November 2025: US labor market data for Oct, RBA & BoE meetings, PMIs for Oct.

Recap from last week: Review of FOMC, BoC, ECB, and BoJ Decisions

While last week’s central bank decisions played out mostly as expected, the FOMC decision was the highlight. It introduced a notable shift in guidance for Dec and revealed an FOMC divided on the outlook. The Australian Q3 CPI was much higher than expected, with implications for the RBA meeting this week. Finally, the meeting and agreement between US President Trump and Chinese President Xi provided a more constructive geopolitical backdrop for now.

FOMC: Shifts Guidance for Dec

The FOMC cut by 25bps last week, with the decision remaining in the realm of a ‘risk management’ cut, given the rising downside risks to the labor market noted at the Sept meeting. The Fed also announced the end of QT next month. The Fed Chair continued to emphasize the challenging situation of “no risk-free path” as the Committee navigates the tension between its employment and inflation goals.

The key feature of this decision, however, was the division among Committee members. Firstly, the decision to cut was not unanimous, drawing two notable dissents – one member (Schmid) preferred no change at this meeting, while another (Miran) argued for a deeper 50bps cut. Secondly, according to Powell, “there were strongly differing views about how to proceed in Dec”, which led to a distinct shift in forward guidance. While markets had priced in a follow-up rate cut in Dec, Chair Powell explicitly countered that expectation:  

“A further reduction in the policy rate at the December meeting is not a forgone conclusion—far from it.” – US Fed Chair Powell, Press Conference, 29 Oct 2025

This shift in guidance appeared to be more than just an attempt to maximize optionality for the Dec meeting. Rather, it reflected the range of views that leaned against the expectation for a continued rate cut in Dec. During the press conference, Powell outlined some of these arguments, including tentative signs that labor market conditions may be stabilizing, as well as members noting “stronger economic activity”. Given inflation is still above target, Powell noted that while the “reasonable base case” assumes tariffs will cause a one-off shift in the price level, many on the board are not simply assuming that will be the case. He also cited lingering data uncertainty stemming from the government shutdown as a reason to pause: “What do you do in a fog? You slow down.” Finally, an argument for slowing down the cadence of easing emerged, noting that the policy rate was 150bps closer to neutral than a year ago:

“And so there’s a growing chorus now of feeling like maybe this is where we should at least wait a cycle, something like that. That’s what it is.”- US Fed Chair Powell, Press Conference, 29 Oct 2025

The post-meeting commentary underscored the committee’s division. Several members outlined their differing views; Schmid (dissent), Logan, and Hammack preferred a hold; Waller still supports a cut in Dec; and Miran (dissent) likely still supports a 50bps cut in Dec. There are more speakers scheduled this week. Overall, the outcome of the Dec meeting will largely be determined by how the data and momentum, especially for the labor market, evolve over the next few weeks. Assessing this momentum remains challenging given the continued lack of official government data. This week, we will continue to rely on private sector reports, instead of the official government data, to assess the US labor market momentum in Oct.

The BoC Signals a Pause

The BoC cut rates at this meeting as expected, based on ongoing weakness in the economy, while inflation pressures remained ‘contained’. The BoC signalled a possible pause, though, with the Governing Council noting that “the current policy rate [is] at about the right level to keep inflation close to 2% while helping the economy through this period of structural adjustment”. The BoC noted that the current economic weakness wasn’t just cyclical, but that trade and tariff changes were leading to a structural adjustment in the Canadian economy.

The domestic picture still poses a challenge for monetary policy. Like the ECB, the BoC noted that some uncertainty over trade and tariffs had receded – but that growth remained under pressure due to tariffs. In Sept, the unemployment rate remained high at 7.1% while headline inflation was +2.4%, slightly higher than the BoC anticipated. While the preferred measures of core inflation have been sticky around 3%, the “upward momentum had dissipated”.

The ECB: Still in a ‘Good Place’

The ECB kept policy settings unchanged as expected. The Governing Council noted that inflation is close to the 2% target, and the inflation outlook was broadly unchanged. Although the growth backdrop remained challenging, growth risks had abated. Past rate cuts were cited as an important source of resilience, with the ECB President stating that “Policy is still in a good place”. The ECB maintained its meeting-by-meeting approach to its assessment.

The broader Euro area continues to show resilience. The latest prelim GDP for Q3 was better than expected at +0.2%, boosted by some stronger country-level results despite political disruption in France, and the challenging manufacturing and trade backdrop facing Germany and the broader Eurozone manufacturing sector. Meanwhile, the latest prelim Oct CPI for the Euro area was little changed from Sep.

The BoJ Maintains its Policy Rate

The BoJ kept rates unchanged as expected, maintaining its normalisation bias. However, the decision was marked by two dissenting votes preferring a rate hike. The dissenters cited “a shift away from the deflationary norm and the price stability target had been more or less achieved”, and “with risks to prices becoming more skewed to the upside, the Bank should set the policy interest rate a little closer to the neutral rate” as reasons for preferring to hike at this meeting.

On the outlook, Governor Ueda reiterated the need for patience, stating: “We held today as we want to see more data on domestic wage-setting behaviors, while uncertainty remains high in overseas economies. If we’re convinced, we’ll adjust rates regardless of the political situation.”

Via Bloomberg: Governor Ueda also made clear that the central bank does not need to see the full results of the wage talks before deciding. He repeatedly emphasized that the BoJ wants only to confirm the initial momentum of wage talks before adjusting policy—a signal that a rate hike may be closer than market reactions might suggest.

Outlook for the week ahead: US Labor Market data for Oct, RBA & BoE meetings, PMIs for Oct

The focus shifts this week to the US labor market for Oct, several central bank decisions, and the full suite of Oct PMIs to assess growth momentum at the start of Q4.

Progress on the resolution of the US government shutdown will also remain in focus this week.

The geopolitical backdrop is expected to remain constructive for now, given positive meetings with US President Trump throughout Asia last week, as well as an agreement signed with Chinese President Xi. While the details of the agreement are limited, markets remain reassured with positive dialogue between the sides.

Key factors & events to watch this week:

US Labor Market for Oct

With the shutdown still in place, we continue to rely on private sector labor market reports (and central bank surveys) to assess momentum in the US labor market.

  • ADP is now releasing its 4-week average payroll growth statistic each week. Last week, for the four weeks ended 11 Oct, payroll growth was +14k.
  • The full month ADP report for Oct is expected to show payroll growth of +25k, up from -32k in Sept.
  • The Challenger Job Cut Announcement survey for Oct will also be released this week. Last month, job cut announcements fell to 54k.
  • The various ISM and S&P PMIs will also provide some guidance on changes in employment conditions from the prior month across manufacturing and services firms.

US PMI Data – Oct

ISM & S&P PMI surveys for Oct will provide some further insight into changes in growth momentum.

  • The ISM surveys are expected to show stagnant conditions in manufacturing and only modest growth in Services in Oct. The ISM Manufacturing PMI is expected to stay around 49, while the services PMI is expected to increase to 51. Across both reports, key indicators will be the momentum in orders, employment, and prices.
  • The S&P prelim US PMIs for Oct showed somewhat stronger activity in Oct compared to Sept. The S&P manufacturing PMI is expected to confirm a modest expansion at 52.2, and a more widespread expansion in the services sector at 55.2.

US Fed speeches & Data

  • There is a range of Fed speeches scheduled for this week. Of note is Governor Waller (central banking and the future of payments), Governor Cook (economic outlook and monetary policy), Vice Chair (Supervision) Bowman, and Fed Vice Chair Jefferson.
  • The latest Senior Loan Officer Opinion Survey is expected to be released.
  • The US Consumer Credit Change for Sept will be released at the end of the week. Growth in consumer credit in Aug was a mere +$0.36bn.

The RBA Meeting

Last week’s Q3 CPI came in higher than the already firmer expectations. Every category made a positive contribution to inflation in Q3. The trimmed mean and median measures of underlying inflation also increased notably compared to Q2, while not to the same degree as headline inflation, but still suggesting that it wasn’t just outliers driving the higher inflation in Q3. This will have implications for the RBA decision this week.

  • RBA Decision: expected to stay on hold. The RBA also stayed on hold at the last meeting pending the Q3 inflation print, noting that the Sept quarter inflation could be higher than expected.
  • Updated forecasts will also be released.

The BoE Meeting

  • BoE Decision: expected to stay on hold, despite some recent continued cooling in the labor market. Markets are expecting a hold pending the UK government budget release later in Nov.

Canada Labour Market – Oct

  • Conditions are expected to remain weaker, with employment expected to fall by -4k (versus +60k in Sept), and the unemployment rate is expected to increase to 7.2%.

The full suite of global S&P PMIs for Oct will be released this week.

This week, the US Treasury will auction and settle approx. $532bn in ST Bills, raising approx. $42bn in new money. QT this week: Approx $13bn in ST Bills will mature on the Fed balance sheet and will be reinvested.

The US Treasury will also update its quarterly financing requirements for Q4 2025 and provide estimates for Q1 2026.

More detail (including a calendar of key data releases) is provided in the briefing document – download the pdf below:

Weekly Macro Outlook – 3Nov2025Download

Comments and feedback are welcome. Please email me at kim.mofardin@marscapitalpartners.net