Today US inflation as the PMI’s suggest a resilient global economy

September’s Personal and Consumption Expenditure Index, out later today, will be the last piece in the Fed’s interest rate jigsaw puzzle. Anything that starts with a 2 is probably good enough to ensure the Fed cuts interest rates. The latest employment data continues to suggest a mixed bag on the jobs front. Yesterday’s private payroll report, issued by ADP, showed that the U.S. economy unexpectedly shed 32,000 jobs in November. But today’s initial jobless claims data showed new applications for unemployment benefits fell last week. Ahead of today’s report, markets were quiet.

There was some good news for the UK economy this week, or should I say news that was not as bad as feared. November’s flash PMI surveys indicated that economic growth has stalled, job losses have accelerated, and business confidence has deteriorated. Understandable while we waited for the budget. This week, the confirmed UK Composite PMI for November 2025 was 51.2, a slight decrease from 52.2 in October, and was slightly revised up from 50.5, continuing to indicate modest economic expansion. The budget may not have been as bad as feared, and at least now it’s out of the way. One could also argue that at least we have a budget, unlike France, who struggle to agree on one.

US and European futures are ticking higher this morning in anticipation of a positive inflation report later today. The JP Morgan Global Composite PMI for November showed the global economy sustaining a solid rate of growth. Economic activity continued to rise in both the manufacturing and services sectors, albeit at slightly slower rates than in the prior survey month. Commenting on the numbers, Maia Crook, Global Economist at J.P.Morgan, said the global composite PMI continues to hover around a level that suggests solid above-trend global GDP growth, which is encouraging.

Growth resilient; interest rates probably coming; investor sentiment mixed at best; not much to suggest we are in greed territory anyway. Having said that, the weekly AAII retail investor survey showed a sharp rise in bullish sentiment, likely driven by the strong end to November. Most fund managers would like to see a robust but calm end to the year.