In this week's edition:
· U.S. Equity Markets End Steady, Recovering Early-Week Losses After Fed Chair Powell’s Remarks on Friday.
· Gold Rises by 1.07% on Signs of a Dovish Pivot from the Federal Reserve.
· Ghana’s Treasury Auction Records Third Consecutive Undersubscription at 10.45%, With Yields Steady Overall but Edging Up at the Short End of the Curve.
· Ghana Stock Exchange Sees Marginal Retreat; GSE-CI Slips to 50.28% YTD, GSE-FSI Eases to 43.21% YTD.
- Kindly click to view the full report: Global Market Update - August 25, 2025
AROUND THE GLOBE
· Powell Signals Possible Fed Rate Cut in September
o Fed Chair Jerome Powell indicated the Fed may cut rates in September, citing mounting labor market risks despite persistent inflation. July’s weaker hiring data heightened concerns about potential layoffs, while Trump’s tariffs could sustain price pressures. Powell noted policy remains restrictive but could be eased if risks shift further toward jobs. Markets priced in a 75% chance of a September cut, driving yields lower, stocks higher, and the dollar weaker.
· US Manufacturing Expands at Fastest Pace Since 2022
o The S&P Global US Manufacturing PMI rose to 53.3 in August 2025 from 49.8 in July, beating forecasts of 49.5. The reading signaled renewed factory growth after July’s contraction, marking the strongest pace since May 2022. Output rose for a third month, supported by the largest new orders increase since February 2024. Employment rebounded sharply, posting the biggest payroll gain since March 2022, while inventories also surged.
· Eurozone Inflation Steady at 2% in July
o Eurozone annual inflation held at 2% in July 2025, matching June figure and the ECB’s target. The data were also in line with flash estimates. Services inflation eased to 3.2%, a three-year low, offset by faster gains in food, alcohol, tobacco (3.3%) and non-energy goods (0.8%). Energy prices remained in deflation at -2.4%. Core inflation stayed at 2.3%, the lowest since January 2022, signaling stable underlying price pressures.
· UK Inflation Rises to 3.8% in July
o The UK’s annual inflation rate climbed to 3.8% in July 2025, the highest level since January 2024, up from 3.6% and above forecasts of 3.7%. Transport was the main driver, with airfares surging by 30.2% on summer holiday demand, alongside higher fuel and sea fares. Prices also rose for restaurants, hotels, and food. Housing and household services eased to 6.2%, partly offsetting gains. Monthly CPI rose by 0.1%, while core inflation edged up to 3.8%.
· Eurozone Private Sector Growth Hits 15-Month High
o The HCOB Eurozone Composite PMI rose to 51.1 in August 2025 from 50.9, beating forecasts of 50.7 and marking the strongest expansion since May 2024. Growth was underpinned by services (50.7) and the first manufacturing rebound in over three years (50.5). New orders rose for the first time in 14 months, boosting hiring. Still, business confidence slipped on US tariff risks and regional headwinds as input costs and output prices climbed.
· China’s FDI Falls 13.4%, High-Tech Sectors Shine
o China’s FDI fell by 13.4% year-on-year to CNY 467.34 billion in Jan–Jul 2025, reflecting global uncertainty. Services led with CNY 336.25 billion, while manufacturing drew CNY 121.04 billion. High-tech investment surged, with e-commerce up 146.8%, aerospace 42.2%, and pharma 37.4%. Inflows from ASEAN countries rose by 1.1%. Similarly, inflows from Switzerland, Japan, and the UK posted strong gains.
- GHANA
· Outstanding Corporate Debt Shrinks by 95% Year-to-July
o Outstanding corporate debt securities on the Ghana Fixed Income Market (GFIM) plunged by 95% to GH¢44.2m by July 2025, from GH¢919.89m a year earlier, per the GSE Fund Managers Report. The drop stemmed from reduced issuance and retirements, with balances from issuers like Izwe (GH¢75m vs GH¢100m), Cocobod (GH¢7.33bn vs GH¢7.93bn), ESLA and Daakye Trust (all bonds from both issuers have been retired). Conversely, Kasapreko more than doubled its debt to GH¢351.18m, while Federated Commodities debuted with GH¢72.55m. As a result, government instruments continue to dominatd, pushing total GFIM volumes up by 52% to GH¢129.66bn.
· BoG Halts Unbacked USD Payouts to Corporates
o The Bank of Ghana has ordered banks to stop foreign currency cash payouts to large corporates unless backed by prior deposits, in a bid to protect reserves and stabilize the Cedi. The directive targets bulk oil distributors, mining firms, and others withdrawing unbacked dollars. Despite a current account surplus of US$3.4bn, reserves of US$11.1bn, and a 40.7% Cedi rally in H1 2025, the BoG said tighter oversight is needed. Non-compliance by banks will attract sanctions.
- AFRICA
· South Africa Inflation Edges Higher to 3.5% in July
o South Africa’s annual inflation rate climbed to 3.5% in July 2025, a ten-month high and matching forecasts, marking a second straight increase. Price pressures were driven by food & non-alcoholic beverages (5.7% vs 5.1%), alcohol & tobacco (4.6% vs 4.4%), and restaurants & hotels (3% vs 2%). Transport costs fell more slowly (-1.7% vs -3.3%), cushioned by smaller fuel declines (-5.5% vs -11.2%). Core inflation edged up to 3.0%, while monthly inflation surged 0.9%.
· S&P Upgrades Kenya to B on Improved Liquidity
o S&P has upgraded Kenya’s long-term sovereign credit rating to B from B- with a stable outlook, citing eased external liquidity pressures from robust exports, remittances, and a $900m Eurobond buyback earlier this year. The liability management operation, alongside lower domestic interest rates, has boosted investor confidence and supported credit growth. S&P expects strong medium-term growth to offset high borrowing costs. The upgrade reverses last year’s downgrade tied to debt risks and stalled tax reforms.
Sources: Bloomberg, Reuters, Trading Economics
