Macro data remains mixed in the US, creating an uncertain path for rate cuts moving forward. Overall labour data remains resilient for now, while inflation is drifting lower (with the exception of producer prices, which are more sticky). 

Data-wise, the biggest disappointment was US GDP growth, which grew at 1.4% quarter-on-quarter vs. the 3.5% forecast and the 4.4% growth the quarter before. The market seemed to discount this data point, as a big contributor was the drop in government spending due to the shutdown. The cooldown in consumer spending is another warning sign; however, personal spending and income both remained in growth territory (both up 0.4% and 0.3% vs. flat forecasts). 

On the labour front, data was quite supportive, with the latest nonfarm payrolls report showing 130k added jobs, almost double the forecast and triple the previous print for December. However, overall non-farm employment growth was revised down to +180k from the initially reported +585k. The US unemployment rate ticked down to 4.3% (lowest level since May) despite much higher forecasts, while private hiring appears to be resilient, with four consecutive growth prints that outperformed forecasts and the fastest hiring growth since November. 

Inflation data came out more mixed, with headline and core inflation still moving downwards; however, the recent prints were a touch higher than their forecasts. Additionally, it seems that producer prices are more sticky, with the latest figure up 0.5% month-on-month and at the highest level in the last 6 months.

Moving to the housing market, recent sales data have deteriorated slightly; however, arguably the main data point, mortgage rates, appear to be supporting property buying in the future. 

Existing Home Sales collapsed by 8.4% in January, marking the biggest drop since early 2022. This marked an almost 9% reduction month-on-month. 

Sales of new homes fell by 1.7% from the near-four-year high in the previous month, printing firmly above market expectations of 730,000 and marking the second-highest level in the period.

The Case-Shiller 20-City Home Price Index rose again by 1.4% year-on-year in December 2025, matching November’s reading and hitting market expectations. That said, annual price growth remains near its weakest level in more than two years. 

Mortgage rates came off mostly through February. The 30-year mortgage was down 10 bps, while the 15-year mortgage was up 5 bps, hitting their lowest levels since 2022. 

The Bank of England keeps rates unchanged, even though inflation continues to slide and unemployment has just hit its 5-year high. The growth story has a mixed outlook, with GDP softening, unemployment ticking up, and some positives in retail sales and manufacturing. 

The main negative data points were: 

On the positive side, Manufacturing PMI remained in growth territory at 52, while services improved even more and printed towards 54. Retail Sales also came out stronger at 1.8% month-on-month growth, vs. 0.2% expected and 0.4% previously. 

UK consumer price inflation eased to 3%, down from 3.4% in December and marking the lowest inflation since March. This was mainly due to declines in transport and food costs. 

Looking at housing, there are continuing signs of a softening market, with appreciation slowing and mortgage approvals easing. 

The Halifax Index increased 1% year-on-year for January, marking the largest increase in three months. The average UK home surpassed £300,000 for the first time, reaching £300,077. On a monthly basis, prices rose 0.7%, beating the expected 0.1% growth.

The RICS UK Residential Survey showed the balance rose to -10% from -13% in the previous month. Still in negative territory, this constitutes the third consecutive improvement and the best reading since June. The city of London continued scoring much worse than the nationwide figures, with Scotland and Northern Ireland still reporting gains. 

Finally, net mortgage approvals for house purchases dropped once again in January, missing forecasts and hitting a fresh low since the summer of 2024. 

Official statistics released at the end of February showed that China’s economy grew ~5.0 % in 2025, a target Beijing had set, with services and consumption contributing the most to expansion. China is entering a key policy season with the National People’s Congress in early March, when policymakers are expected to outline the 2026 growth target (probably around 4.5%–5%) and new priorities, including boosting domestic demand, technology, investment strategy, and managing debt/structural risks.

Official PMI data showed manufacturing slipping back into contraction territory in January (49.3 and 49.4), highlighting how sporadic the readings have been recently. New orders slipped back into contraction alongside a slowdown in output growth. Inflation data came out softer than expected (0.2% vs. 0.5%) for both month-on-month and year-on-year. 

Looking at the property market, nationwide new home prices continued to fall on both a monthly and annual basis, extending the longest downturn on record. China’s new home prices declined 3.1% year-on-year in January, marking the 31st consecutive month of price decreases and the fastest pace since June. Prices also dropped by 0.4% month-on-month, and there doesn't seem to be any light at the end of the tunnel.  

Don’t Miss Another Winning Trade

(n.d.). US Treasuries Yield Curve. US Treasuries Yield Curve. https://www.ustreasuryyieldcurve.com/

(n.d.). CME FedWatch Tool. CME Group. https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html

(n.d.).Trading Economics. Trading Economics. https://tradingeconomics.com/united-states/nahb-housing-market-index

(n.d.).Goldman Sachs. Goldman Sachs. https://www.goldmansachs.com/

(n.d.).Bloomberg. Bloomberg. https://www.bloomberg.com

(n.d.). FRED. Federal Reserve Economic Data. https://fred.stlouisfed.org/

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