Okay, here’s your macroeconomic report for the week, formatted as requested and incorporating a narrative approach.

Update for Week 48 of 2025

Date: November 28, 2025 The global economy finds itself at a critical juncture as we approach the end of 2025. This week’s data paints a picture of persistent inflationary pressures, a resilient but potentially softening labor market, and a housing sector struggling to find its footing amidst high interest rates. Central banks remain vigilant, walking a tightrope between controlling inflation and avoiding a sharp economic downturn. The narrative emerging is one of cautious optimism tempered by significant uncertainty. The strength of the consumer remains a key factor, but dwindling savings and persistent price increases are casting shadows on future spending. Business investment, while showing some signs of life, remains hesitant, awaiting clearer signals about the path of monetary policy and overall demand.

1. Inflation

Inflation continues to be the dominant economic narrative, although the story is becoming more nuanced. While headline inflation has cooled somewhat from its peak, underlying price pressures remain stubbornly persistent. This week’s CPI data showed a slight deceleration in the headline figure, but core inflation (excluding food and energy) remained elevated, suggesting that the disinflation process may be slower than initially hoped. A key driver of this stickiness is the ongoing strength of the labor market, which is contributing to wage pressures. Supply chain disruptions, while less acute than in previous years, continue to play a role in certain sectors, particularly in electronics and specialized manufacturing.

  • Headline CPI/PCE: Headline CPI rose 0.3% in October, bringing the year-over-year increase to 3.5%. The PCE price index, the Fed’s preferred inflation gauge, increased 0.2% in October, with the year-over-year change at 3.0%.
  • Energy Prices: Energy prices have been volatile, with geopolitical tensions in the Middle East adding to supply concerns. Crude oil prices traded in a range of $80-$85 per barrel this week.
  • Food Prices: Food price inflation remains elevated, driven by a combination of factors, including adverse weather conditions in key agricultural regions and rising input costs. Quote: “We are committed to achieving our 2% inflation target, and we will use our tools to ensure that inflation returns to that level.” - Jerome Powell, Federal Reserve Chair, Press Conference, November 20, 2025

2. Employment

The labor market remains a bright spot in the economy, but there are signs that it may be gradually cooling. The unemployment rate remains low, but initial jobless claims have ticked up slightly in recent weeks. Job openings are still plentiful, but the pace of hiring has slowed. Wage growth, while still strong, has also begun to moderate. This suggests that the labor market is gradually rebalancing, but it remains relatively tight. The participation rate has remained stable, indicating that the supply of labor is not increasing significantly.

  • Unemployment Rate: The unemployment rate held steady at 3.7% in October.
  • Job Openings (JOLTS): The JOLTS report showed 9.5 million job openings in September, down slightly from the previous month.
  • Wage Growth: Average hourly earnings increased by 0.3% in October, with the year-over-year growth rate at 4.2%. Quote: “The labor market is still strong, but we are seeing some signs of moderation. We will continue to monitor the data closely.” - Janet Yellen, Treasury Secretary, Interview with Bloomberg, November 22, 2025

3. Housing Market

The housing market continues to struggle under the weight of high mortgage rates. Home sales have fallen sharply, and inventory levels remain low. Construction activity has slowed, as builders respond to weaker demand. Affordability is a major challenge for many potential homebuyers. The sector is highly sensitive to interest rate changes, and the recent increases in mortgage rates have had a significant impact. The long-term outlook for the housing market remains uncertain, but a gradual recovery is expected as interest rates eventually stabilize.

  • Mortgage Rates: The average 30-year fixed mortgage rate remained elevated at 7.25% this week.
  • Home Sales: Existing home sales fell by 2.0% in October, marking the ninth consecutive month of declines.
  • Construction/Starts: Housing starts decreased by 3.0% in October, indicating a slowdown in construction activity. Quote: “The housing market is facing significant headwinds from high mortgage rates, but we expect a gradual recovery as rates eventually stabilize.” - Lawrence Yun, Chief Economist, National Association of Realtors, Housing Market Report, November 25, 2025

4. GDP & Economic Growth

The overall economy continues to grow, but the pace of growth has slowed. Consumer spending remains the primary driver of economic activity, but there are signs that consumers are becoming more cautious. Business investment has been sluggish, as companies grapple with uncertainty about the economic outlook. The manufacturing sector has been particularly weak, reflecting a slowdown in global demand. The services sector has been more resilient, but it is also showing signs of moderation. The risk of a recession remains a concern, but the economy has so far proven to be surprisingly resilient.

  • GDP Estimates: The latest estimate for Q3 GDP growth was 2.5%.
  • Manufacturing/Services PMIs: The Manufacturing PMI remained in contractionary territory at 49.5 in November, while the Services PMI edged down to 51.0.
  • Consumer Confidence: The Consumer Confidence Index decreased slightly in November, reflecting concerns about inflation and the economic outlook. Quote: “The economy is slowing, but it is not yet in a recession. We expect growth to remain subdued in the coming quarters.” - David Kelly, Chief Global Strategist, JP Morgan Asset Management, Market Outlook, November 24, 2025

5. Monetary Policy

Central banks around the world remain focused on controlling inflation. The Federal Reserve held interest rates steady at its November meeting, but signaled that further rate hikes may be necessary if inflation does not continue to moderate. Market expectations are for the Fed to remain on hold for the next few months, but the possibility of further tightening remains on the table. The European Central Bank (ECB) also held rates steady, but warned that inflation remains too high. The Bank of England (BOE) is facing a particularly difficult situation, as it grapples with high inflation and a weak economy.

  • Interest Rates: The Federal Funds rate remains in a target range of 5.25%-5.50%.
  • Fed Speak/Guidance: Fed officials have emphasized that they will remain data-dependent and will adjust monetary policy as needed.
  • Market Expectations: Market participants are pricing in a low probability of further rate hikes by the Fed. Quote: “We are committed to bringing inflation back to our 2% target, and we will do what it takes to achieve that goal.” - Christine Lagarde, President, European Central Bank, Press Conference, November 21, 2025

Conclusion

The global economy is navigating a complex and uncertain environment. Inflation remains a key challenge, and central banks are walking a tightrope between controlling inflation and avoiding a recession. The labor market is gradually rebalancing, but it remains relatively tight. The housing market is struggling under the weight of high mortgage rates. Overall economic growth has slowed, but the economy has so far proven to be resilient. The outlook for the coming weeks is uncertain, but the strength of the consumer will be a key factor in determining the path of the economy. Investors should remain vigilant and prepared for volatility.