Weekly market brief - 17 October 2025

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* Investors Pile Into Gold Amid Market Turmoil
* U.S. Shutdown – Politicians Are Digging In Their Heels
* EM Sentiment Sours Amid Equity Rout
* U.S. and China – Playing Chicken On a Global Scale
* Powell Signals a Cut Later This Month
* Safe Haven Demand Dominates
* China Concerns Pressure Commodity FX
* U.S. Small Business Optimism Declines
* Can Anything Stop Gold?

Currency Outlook

  • The IMF increased its global growth forecast for 2025 to 3.2%, up from its July update, while keeping the 2026 projection unchanged at 3.1%.
  • Emerging market stocks and currencies fell on Friday, capping a volatile week dominated by renewed trade jitters, while worries about the banking industry and a slide in oil prices added another layer of concern.
  • In his weekly newsletter, President Cyril Ramaphosa highlighted South Africa’s participation in the Global Gateway Forum in Brussels, held at the invitation of European Commission President Ursula von der Leyen.
  • At that summit, the EU announced an initial investment package of EUR 4.7 billion to support strategic projects in South Africa.
  • A weekly close below R17.3500/USD could indicate further strength to R17.2920/USD, R17.1261/USD, and give way to R16.9602/USD levels. A close above R17.35/USD can push the rand towards R17.4026/USD, R17.5685/USD and subsequently R17.7344/USD levels.

Local Data

  • Mining production decreased by 1.2% m/m in August, with reduced output of iron ore and gold offsetting strong gains in copper and nickel.
  • The South African Chamber of Commerce and Industry’s (SACCI) business confidence index rose to 121.1 in September from 120.0 in August
  • Retail sales growth slowed in August, rising 2.3% y/y after having increased by an upwardly revised 5.7% y/y in July.

Interest Rate Outlook

  • The SARB decided to hold the repo rate at 7.0% and the prime lending rate at 10.50% at its September meeting. The decision was not unanimous, with four of the MPC members voting to leave the rate unchanged while two voted for a 25 basis points cut.
  • The next rate decision of the Monetary Policy Committee will be announced on 20 November 2025.

International News

  • US
    • The U.S. NFIB small business optimism index slipped to 98.8 in September, from 100.8 in August.
    • As the U.S. government shutdown extended into its third week, several key economic releases, including CPI, PPI and retail sales, will be delayed.
    • The Fed’s latest Beige Book indicated that U.S. economic activity was largely unchanged in recent weeks, with employment levels remaining broadly stable.
    • The U.S. Empire State manufacturing index rebounded sharply in October, rising to 10.7, from -8.7 in September, far exceeding expectations of a slight contraction around -1.8.
  • Euro zone
    • Eurozone industrial production declined slightly less-than-expected in August, by 1.2% m/m, after having increased by 4.7% m/m in July.
    • ECB President Christine Lagarde said that borrowing costs are at appropriate levels to withstand any turbulence the global economy may face.
    • She noted that the risks to both inflation and economic growth have become more balanced.
  • United Kingdom
    • BOE policymaker Catherine Mann warned that there is “very clear upside evidence” suggesting that UK inflation may remain above the BOE’s 2% target for an extended period.
    • The UK unemployment rate increased unexpectedly in August, while wage growth slowed more-than-expected.
    • UK GDP grew by 0.1% m/m in August, following a slight contraction of 0.1% m/m in July.
  • China
    • China’s deflationary pressures continue to impact both consumer and producer prices in September as trade tensions weigh on confidence.
    • China’s new Yuan loans rose less-than-expected in September, mainly due to weak credit demand as policymakers battle to reverse a prolonged property slump and curb industrial overcapacity.
  • Australia
    • Australia’s unemployment rate continued to increase in September, reaching a four-year high as more people went out seeking employment.
    • The unemployment rate rose to 4.5% in September from 4.3% in August.
  • Japan
    • Japan’s August machinery orders rose 1.6% y/y much below analysts’ forecast of a 4.8% y/y forecast.

Precious Metals

  • Gold extended its record-breaking rally this week, surging past $4,300/oz for the first time as investors piled into safe-haven assets amid mounting U.S.-China trade tensions, a U.S. government shutdown, and heightened expectations of Federal Reserve rate cuts.
  • Holdings of the SPDR Gold Trust, the largest gold-backed ETF, increased to 1,034.62 tons on Thursday, it’s highest level since July 2022.

Base Metals

  • Copper prices fluctuated sharply this week amid shifting U.S.-China trade headlines, supply disruptions, and monetary policy expectations.
  • By Friday, copper fell to a one-week low and was heading for a second straight weekly decline as global financial stocks traded lower on signs of credit stress at US regional banks.

Oil

  • Oil prices swung sharply through the week as traders weighed U.S.-China trade tensions, supply outlooks, and geopolitical shifts.
  • On Thursday, prices fell more than 1% after Trump said he and Russian President Vladimir Putin agreed to meet in Hungary soon to discuss ending the war in Ukraine.
  • US Energy Information Administration data showed crude oil inventories rose by 3.524 million barrels in the week ended October 10, more than market expectations of a 0.12 million barrel build.