Global News Summary 3 - 7 Nov 2025
Global markets shifted from optimism to caution as the AI-driven rally lost momentum, central-bank patience met slowing growth, and the prolonged U.S. government shutdown clouded macro visibility. The week featured weaker risk sentiment, rising policy divergence between regions, and renewed scrutiny of technology valuations. Despite these headwinds, liquidity, fiscal support, and expectations of future rate cuts helped limit downside pressure across asset classes.
United States
Economic Growth & Policy:
Markets traded nervously amid the longest U.S. government shutdown on record, which suspended major data releases such as the jobs report and CPI. Private trackers signaled slower employment growth and service-sector moderation, reinforcing the case for further Fed easing. Futures markets priced the Fed Funds Rate near 3 % in 2026, with about 70 % probability of a December 2025 cut.
Jobs:
Private payrolls rebounded by +42 k in October (consensus +30 k, prior –29 k), ending two months of declines, but hiring momentum remains weak.
Debt Securities:
U.S. Treasury yields stayed broadly flat — 2 Y 3.56 %, 10 Y 4.09 %, 30 Y 4.70 % — as investors balanced shutdown uncertainty with expectations of easing.
AI & Markets:
Wall Street sold off early in the week on valuation fears in mega-cap AI stocks, erasing roughly US$ 750 bn in paper gains before dip-buyers stabilized indices. The S&P 500 (+0.1 %) and Dow (+0.2 %) barely held ground, while the Nasdaq 100 (–0.3 %) underperformed. Analysts described the move as a “technical correction” within an over-extended bull cycle.
Inflation:
Shutdown-related data gaps left official inflation readings unavailable, but private estimates indicated headline CPI ≈ 2.9 % YoY, aligning with the Fed’s confidence to keep cutting.
Recession Risks:
Survey data suggested rising business caution; 35 % of institutional investors expected a deeper equity pullback if the shutdown persisted beyond a month.
United Kingdom
Fiscal & Growth:
Chancellor Rachel Reeves prepared a fiscally tight Budget aimed at easing inflation and boosting productivity. She vowed to cut VAT on household electricity and pursue a “blitz on bureaucracy” to save firms ~£6 bn annually.
Currency & Jobs:
Sterling slipped to $ 1.316 / € 1.156, its weakest level since 2023, as investors braced for potential tax rises. Employment data remained soft, with only modest payroll gains after months of layoffs.
Inflation:
Above-target price pressures persist, keeping the Bank of England on alert even as markets anticipate eventual cuts in H1 2026.
Euro Area
Economic Growth:
Eurozone Q3 GDP +0.2 % QoQ, supported by France (+0.5 %) despite political unrest. Germany lagged but investor confidence improved.
Debt & Rates:
The ECB held its deposit rate at 2 % for a third meeting, maintaining the stance that policy is “in a good place.” Core inflation eased to around 2.3 %.
Fiscal / Defense:
Germany approved €1.9 bn in new defense procurements, underscoring continued fiscal expansion despite slow growth.
Japan
Monetary Policy:
The Bank of Japan kept rates unchanged at 0.5 %. Meeting minutes revealed a split — two members pressed for hikes while most urged caution due to deflationary legacies.
Labor & Wages:
Japan’s largest union group targeted 6 % wage hikes again for 2026, matching this year’s record-setting demand — a crucial factor for the BoJ’s inflation outlook.
Markets:
The Nikkei fell about 4 % on the week amid global tech weakness, though yen stability (¥ 153–154 per USD) limited volatility.
China
Growth & Industry:
Industrial profits +21.6 % YoY in September, marking the strongest rise since late 2023. However, manufacturing PMI 49.0 signaled continued contraction.
Trade & Policy:
Following talks with Washington, export-control delays on rare earths and chips and a one-year trade truce buoyed markets. The PBoC was expected to resume bond purchases to ease liquidity as investors rotated from bonds to equities.
Canada
Fiscal Policy:
PM Mark Carney’s maiden budget unveiled C$ 141 bn in new spending (mainly defense and trade-shock relief) offset by C$ 51 bn in savings, widening the deficit to C$ 78.3 bn. Accelerated depreciation rules will cut the marginal effective corporate tax rate to 13.2 % (from 15.6 %), aiming to stimulate investment amid U.S. trade tensions.
Australia
Monetary Divergence:
The AUD hit a 12-year high vs NZD, driven by diverging central-bank outlooks — the RBA holding steady while the RBNZ leans dovish.
Inflation & Labor:
Former RBA Governor Philip Lowe warned that persistently high unit-labor costs (~5 %) hinder achieving the 2–3 % inflation target, suggesting “sitting still” may be prudent.
Artificial Intelligence & Tech
Nvidia & AMD: Nvidia’s CEO cautioned the U.S. could lose AI leadership to China due to lower energy and regulatory costs. AMD shares fell after a weak revenue outlook, amplifying bubble concerns.
OpenAI CFO Sarah Friar urged more market “exuberance,” arguing fears of an AI bubble are exaggerated.
AI infrastructure boom: Oracle and banks arranged $18 bn in financing for data-center expansion; investors funneled record funds into AI hardware supply chains.
ESG & Energy
Oil: WTI crude ≈ $ 59.85 / bbl, lowest since mid-2024, as global supply outpaced demand.
Gold: Surged 0.7 % to $ 4 003.75 / oz, breaking the $ 4 000 threshold amid risk aversion.
Corporate: Brookfield Asset Management reported record earnings, while Constellation Energy faced investor pressure over slow reactor rollout.
Inflation, Debt & Recession Risks
Inflation: Stable to easing globally (U.S. ~ 2.9 %, Eurozone 2.3 %, Japan 2.8 % Tokyo).
Debt: Fiscal expansion in Canada and Germany contrasts with U.S. deficit concerns; Fed’s balance-sheet runoff pause expected soon.
Recession: No immediate downturn, but soft-landing confidence waning as data flow stalls; equity strategists foresee a 5–10 % pullback before year-end.