Monthly Report: October 2025

United States

Macro-wise, the main event this month was the Federal Reserve’s continued rate cuts. Data-wise, we didn’t get much, as the government shutdown is delaying the release of key indicators, especially labour-market indicators. 

The data we can use for the labour market has been the Preliminary data from ADP, which showed that the private sector added an average of 14250 jobs per week over the 4 weeks (ending October 11th), reversing the negative September print. Additionally, the Chicago FED estimates that September unemployment remains stable at 4.34%. 

Both core and headline inflation cooled down on a month-on-month basis by 0.1%, compared to their previous figures. On a year-on-year basis, core inflation fell 0.1% to 3%, while headline inflation rose 0.1% to 3%; however, both were in line with market forecasts.  

Mortgage rates continue their downward trend, reflecting the Fed's resumption of rate cuts. This marked the 4th consecutive month of declining rates. 30-year and 15-year rates collapsed by more than 15 bps and 10 bps, respectively, in October. 

Existing home sales grew by 1.5% month-on-month to 4.06 million for September (up 4.1% year-on-year), marking the highest level in the last 7 months and a slight miss from the 4.1m expected. The median price for existing home sales is higher by 2.1% year-on-year and marks the 27th consecutive month of appreciation. 

There isn’t any fresh data on new home sales, as a reminder, new home sales rallied by 20.5% from the previous month to an annualized rate of 800k, the highest level since 2021. Median prices for new homes also rallied by 4.7% month-on-month. 

United Kingdom 

Overall, the data releases have been supportive in the UK this month, except for unemployment, which ticked up to 4.8% from the 4.7% expected and registered last month. Inflation remained stable at 3.8% year-on-year, beating expectations for a 4% print. GDP grew at 0.1% month-on-month vs. the -0.1% decline recorded last month. Retail sales outperformed, rising 0.5% month-on-month vs. the expected -0.1% decline. Manufacturing PMI rose to 49.6 from 46.2 previously and 46.7 forecast, while services PMI met expectations at 51.1m, up from 50.8 previously. 

In a nutshell, the UK property market is stable, despite relatively high mortgage rates and all-time-high prices; however, consumer confidence seems a bit weaker than the indices suggest. 

The Halifax House Price Index in the UK fell -0.3% month-on-month, reversing the latest gain and missing the 0.2% growth expectation. The Index still rose by 1.3% year-on-year, easing from the 2% increase last month and the 2.2% expectation.  This marked the softest increase since April 2024 (since stamp duties went up). The average property value increased to £298,184, dropping slightly from last month’s record high.

The RICS Market Survey showed the balance increasing to -15 in September, marking the first uptick following 5 consecutive negative readings and beating the forecast of -18. In the short term, the outlook remains slightly negative; however, most participants seem confident on a 12-month horizon. 

Finally, in the UK, the Nationwide House Price Index rose 0.3% month over month in October 2025, beating forecasts of 0% but easing from a 0.5% increase the previous month. On a year-on-year basis, the index rose by 2.4% beating the expected 2.3% and up from 2.2% in September. 

China

Once again, all the macro data from China remains inconclusive and mixed. Industrial production outperformed expectations, growing by 6.5% year-on-year, beating the 5.1% forecast. Retail sales printed at 3% year-on-year, a miss from last month's 3.4% but in line with expectations. Exports and imports showed higher growth year-on-year at 8.3% vs. 5.2% expected and 7.4% vs. 3.5% expected, respectively. 

On the other hand, inflation came in at -0.3%, below the -0.2% forecast, and GDP grew by 4.8% year-on-year, below the 4.9% forecast and the 5.2% recorded last month.  

China’s new home prices were down by 2.2% year-on-year for September, continuing their trend for shallower yearly declines and the lowest decline since March 2024. Nonetheless, this now marks the 27th consecutive month of year-on-year declines in house prices and the biggest monthly drop (-0.4%) in the last 11 months. For the last 12 months, the year-on-year declines have been getting shallower, though. Shanghai is the main outlier, showing once again a 5.6% gain in house prices.

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References

(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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