Global News Summary: 22- 27 Sep 2025

Written By Larry Lim

Markets entered late September with record U.S. equity highs but growing caution over valuation, fiscal risks, and Fed policy trajectory. The Federal Reserve’s September rate cut and Powell’s measured tone kept risk assets supported, with the S&P 500 rebounding +0.6% on 27 September after three days of declines. Core PCE inflation rose 0.2% MoM, 2.9% YoY, aligning with forecasts and confirming no re-acceleration. Global yield curves steepened further, signaling reflation expectations rather than recession fear. Political instability in France and the UK’s fiscal challenges weighed on European sentiment, while Chinese tech stocks massively outperformed on AI and chip self-sufficiency optimism. AI capital flows accelerated, highlighted by Nvidia’s $100bn commitment to OpenAI and multiple mega-scale data center projects. Commodities were mixed — gold hit $3,766/oz (sixth weekly gain), oil stayed near $65/bbl — suggesting hedging demand remains robust. Investors now watch October jobs data and fiscal debates as potential volatility triggers.

By Countries

United States

  • Equities: S&P 500 +0.6%, Nasdaq 100 +0.4%, Russell 2000 +1.0% on 27 Sept; Magnificent 7 Index +0.8%.

  • GDP: Q2 growth confirmed at 3.8%, revised higher from 3.3% on stronger consumer spending (+2.5%).

  • Fed Policy: 25 bps cut delivered last week; Powell signaled data-dependence but pushed back on expectations of aggressive follow-up cuts.

  • Politics: Trump’s 100% tariff on pharmaceuticals shook healthcare sector but exemptions for U.S.-built production tempered downside.

  • Corporate Credit: Borrowing spreads for U.S. companies tightened to the narrowest in two decades.

Europe (EUR)

  • France: Government instability deepened with continued market selloff and a debt downgrade (Morningstar AA from AA-high).

  • Germany/Spain: Spain raised 2025 growth forecast to 2.7%, positioning as top EZ performer.

  • EZ PMI: Rose to 51.2 in September, suggesting modest expansion.

United Kingdom (GBP)

  • Yields: Long gilts breached multi-decade highs near 5.64%; policymakers debating QT slowdown to relieve gilt pressure.

  • Macro: OECD projects 3.5% inflation in 2025 (highest in G7). Private sector PMI fell to 51 (Aug 53.5), raising slowdown concerns.

  • Policy: Splits emerging within BOE committee; Pimco expects inflation to fall enough for deeper cuts.

Japan (JPY)

  • Monetary Policy: BOJ held rates steady at 0.5%, but speculation builds for a hike as early as October or December.

  • Leadership: PM Ishiba’s resignation accelerated political uncertainty; Shinjiro Koizumi announced leadership bid.

China (CNY)

  • Macro: Retail sales slowed to +3.4% YoY; industrial output +5.2% YoY.

  • Markets: Hang Seng Tech Index +41% YTD on AI and chip self-sufficiency optimism.

  • Trade: Beijing introduced new tariffs on U.S. optical fiber imports (33–78%).

Economic Growth

  • Global data show resilient consumption and steady investment.

  • U.S. personal spending and Q2 GDP revisions confirm underlying strength.

  • Spain upgraded growth outlook; Australia’s GDP +0.6% QoQ, household consumption led gains.

Jobs & Labor

  • U.S. labor market weakness remains a key Fed focus, but no new major data between 22–27 Sept.

  • UK wage growth rose to 4.7%, triggering higher pension commitments for 2026.

Debt Securities

  • U.S. 10Y at 4.18%, 2Y at 3.64%; yield curve steepening continues, reflecting growth and term premium repricing.

  • European spreads widened on French political risk; German 10Y stable at 2.72%.

Artificial Intelligence (AI)

  • Mega Deals: Nvidia pledges up to $100bn investment in OpenAI; OpenAI plans $400bn Stargate infrastructure spend.

  • UK Tech Alliance: Microsoft, Nvidia, Google, and OpenAI to invest tens of billions in UK AI infrastructure.

  • M&A and Funding: Modular raises $250mn; Nscale $1.1bn; CoreWeave expands OpenAI capacity agreements to $22.4bn.

Inflation

  • U.S.: Core PCE 2.9% YoY, in line with expectations, supporting measured Fed cuts.

  • UK: 3.8% CPI in Aug, pressuring BOE to stay cautious.

  • Australia: Inflation 3% YoY, largely housing-driven.

Recession Risks

  • Yield curve steepening globally signals reflation, not imminent contraction.

  • Strategists note possible term-premia risk if long yields rise >5%, which could tighten conditions.

  • Market consensus still sees soft landing rather than deep recession.

Larry Lim
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