Asset Management: Monthly Macro Insights - October 2025
Global growth proves resilient amid policy and trade uncertainty
As the final quarter of 2025 begins, the global economy continues to show greater resilience than expected despite ongoing trade tensions, inflation challenges and policy uncertainty. However, central banks are navigating an increasingly difficult environment as they seek to support growth without undermining progress on inflation.
The US economy continues to send mixed signals. While business confidence and labour market indicators have softened, consumption and technology-related investment remain supportive of growth. At the same time, inflation remains above target and concerns are growing that inflation expectations could become more deeply embedded. Against this backdrop, the Federal Reserve has started easing monetary policy but remains cautious, signalling that future decisions will depend heavily on incoming data.
In the eurozone, economic activity has been supported by temporary factors, including strong Irish output and inventory accumulation. Looking ahead, fiscal measures such as Germany’s stimulus plans and increased defence spending could help cushion external shocks. However, household consumption remains subdued and inflation, particularly in services, continues to complicate the ECB’s path toward its medium-term target. As a result, the central bank is maintaining a gradual and cautious approach to policy.
China’s economy remains under pressure despite targeted policy support. Business confidence has stayed weak, the property sector continues to weigh on household spending and investment, and export momentum is fading as global demand softens. While policymakers have introduced selective support measures, they have so far favoured a gradual approach rather than large-scale stimulus, reflecting concerns over financial stability and rising debt risks. Overall, the outlook points to a managed slowdown rather than a strong rebound.
