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In November, the US experienced the most extensive economic shutdown in history, disrupting government operations and delaying wages and salaries for workers. Projections for the US Federal Reserve (Fed)’s policy rate returning to its neutral range of 3.00–3.25% have now been pushed to late 2026, consistent with S&P Global’s outlook. Meanwhile, China’s manufacturing activity showed a slight uptick in November but remained in contraction for the eighth consecutive month. The South African Reserve Bank (SARB) lowered interest rates by 25 basis points in November. South Africa’s unemployment rate declined in Q3 2025 compared to Q2 2025.

Largest US economic shutdown in history

The longest government shutdown in US history concluded after 43 days when President Donald Trump signed a funding bill into law on 13 November 2025. The shutdown disrupted numerous government services, leaving about 1.4 million federal employees either furloughed or working without pay. Efforts have now shifted to reopening agencies and clearing the backlog of delayed federal payments and official data. During this unprecedented closure, agencies such as the Bureau of Labor Statistics halted operations, delaying key economic reports like US jobs data and the Consumer Price Index (CPI).

At a November press conference, Fed Chair Jerome Powell dismissed expectations of additional monetary easing this year. However, J.P. Morgan Global Research notes that the longer-term outlook is uncertain, particularly given the lack of critical economic indicators, making it difficult to gauge future Fed policy. The shutdown weighed on economic performance: the Congressional Budget Office projects Q4 GDP growth will fall by 1.5%, with a rebound to 2.2% in Q1 2026. Historically, government shutdowns have had minimal impact on financial markets, as investors tend to focus on broader macroeconomic trends rather than short-term budget disputes. In Treasury markets, yields climbed at the end of October following the hawkish tone of the previous Federal Open Market Committee meeting.

Global economic outlook

With official US data scarce, financial markets lacked clarity on the economy’s health, increasing the likelihood of volatility when new figures are released. Expectations for a return to the fed funds rate’s estimated neutral range of 3.00–3.25% have now shifted to late 2026, in line with S&P Global’s forecast. The absence of US data makes it harder to gauge economic trends, though S&P Global’s Purchasing Managers’ Indices (PMIs) indicate that economic conditions remain resilient. While some alternative indicators point to continued softening in the labour market, October’s PMI results show the US is still leading major developed economies in output growth, with gains in both manufacturing and services. October PMI data offered tentative signs of improvement in struggling economies such as Canada, the Eurozone, and Japan.

Source: S&P Global Market Intelligence

S&P Global has slightly raised its real GDP growth forecasts for 2025 and 2026. The most notable change is a more optimistic outlook for mainland China. Updated projections for 2025–2027 are now 5.0%, 4.6%, and 4.5%, respectively – about 25 basis points higher than October’s estimates. These upward revisions reflect stronger export prospects and a more supportive policy stance outlined in the 15th Five-Year Plan. While unfavourable base effects and potential trade barriers in non-US markets may temper export momentum later this year, domestic demand is expected to benefit from more accommodative monetary and fiscal measures.

These gains are partly offset by downward adjustments to 2026 growth forecasts for several major economies. Brazil’s outlook has weakened, as the central bank’s firm stance on inflation suggests rate cuts will start later than previously anticipated, compounded by soft recent activity data signalling a challenging second half of 2025. Russia’s 2026 forecast has also been significantly reduced due to headwinds such as additional sanctions and a planned VAT hike. Meanwhile, the UK projection for 2026 has been trimmed to below 1%, slightly under market consensus.

China’s factory activity edges up but remains in contraction

China’s factory activity in November showed a slight improvement but remained in contraction for the eighth straight month, while services weakened as the earlier holiday boost faded, according to official data. The manufacturing PMI rose to 49.2, up 0.2 points from October, the National Bureau of Statistics reported. This was in line with economists’ expectations in a Reuters poll but still below the 50-point threshold that signals expansion. Meanwhile, the non-manufacturing business activity index dropped to 49.5, down 0.6 points from October, and the composite PMI eased to 49.7, reflecting a mild decline in both manufacturing and services. Supply and demand in manufacturing showed modest improvement, with the production index reaching 50 and new orders climbing to 49.2.

Source: National Bureau of Statistics

China’s manufacturing sector has been contracting since April, after the introduction of new US tariffs that pressured producers. Industrial profits dropped 5.5% in October – the steepest decline since June – erasing the strong gains recorded in late summer. Cumulative earnings for major industrial firms rose 1.9% in the first ten months, slowing from the January–September pace. Overall, the Chinese economy has cooled, with growth slipping to 4.8% in the third quarter.

Trade tensions with the US escalated in October as Washington threatened to impose 100% tariffs before a late-month agreement in South Korea. The deal reduced US fentanyl-related tariffs to 10% from 20%, paused China’s rare earth export controls for a year, and reopened purchases of American soybeans and other agricultural goods. Despite this truce, domestic demand remains weak, weighed down by a prolonged property slump and soft labour conditions. Policymakers have signalled a longer-term strategy to boost consumption and strengthen tech self-reliance but have refrained from major new stimulus measures, as the economy is still on track to meet its 5% growth target.

For your interest

  1. Gold expected to hit the US$5 000 mark by 2026
  • Gold has been on a tear this year. A Goldman Sachs survey shows many investors think the precious metal will hit a new all-time high of US$5 000/oz by the end of 2026.
  • In a survey of more than 900 institutional investor clients on Goldman Sachs’ Marquee platform, 36% of respondents – the largest cohort – expect gold to maintain its momentum and exceed US$5 000/oz by the end of next year. A further 33% expect the commodity to reach between US$4 500 and US$5 000/oz, according to the poll, which was conducted between 12-14 November.

(Source: CNBC, November 2025)

  1. UK Budget tabled in November
  • UK chancellor Rachel Reeves set out details of her second Budget since taking office. Several measures in the yearly tax and spending plan had already been announced in the days leading up to the statement.
  • The Office for Budget Responsibility predicts the UK economy will grow by 1.5% this year, upgraded from a 1% forecast in March. The economy is now forecast to grow by 1.5% on average between 2026 and 2029, down from the previous estimate of 1.8%. Inflation is predicted to average 3.5% this year, before falling to 2.5% next year, and returning to the government’s 2% target in 2027.

(Source: BBC, November 2025)

  1. SARB cuts interest rates
  • The South African Monetary Policy Committee (MPC) decided to reduce the policy rate by 25 basis points to 6.75%, with effect from 21 November. The decision was unanimous. Members agreed there was scope to make the policy stance less restrictive, in the context of an improved inflation outlook.
  • The MPC has long emphasised the need for macroeconomic and structural reforms to boost potential growth, achieve a sustainable debt path, and shift to a low-inflation regime. There has been significant progress on reform this year, as underscored by the recent credit rating upgrade from Standard & Poor’s, as well as South Africa’s exit from the Financial Action Task Force grey list.

(Source: SA Reserve Bank, November 2025)

  1. South Africa hosts G20 Summit
  • G20 leaders met for a two-day summit hosted by the South African G20 presidency in Johannesburg. It was the first G20 summit to be held in Africa. Under the motto ‘solidarity, equality and sustainability,’ G20 leaders participated in three working sessions and discussed global challenges and priorities, primarily sustainable economic growth, development and financing.
  • The leaders met against the backdrop of rising geopolitical and geo-economic competition and instability, heightened conflicts and wars, deepening inequality, increasing global economic uncertainty and fragmentation.

(Source: European Council, November 2025)

South Africa’s unemployment declines in Q3 2025

South Africa’s latest Quarterly Labour Force Survey (QLFS) shows the unemployment rate fell to 31.9% in Q3 2025 from 33.2% in the previous quarter – a 1.3% improvement. This translates into roughly 248 000 additional jobs, bringing total employment to 17.1 million, the lowest unemployment rate recorded in the country. The Western Cape added 70 000 jobs quarter-on-quarter, leading provincial gains.

Under the expanded definition of unemployment, which includes discouraged job seekers, the Western Cape’s rate is 25.7%, still significantly better than other provinces. Gauteng follows at 39.6%, while conditions are most severe in the Eastern Cape and North West. The Eastern Cape was the only province where unemployment rose in Q3. Its expanded rate was 50.2%, meaning more people are unemployed than employed. North West fares even worse under this measure, at 52.5%.

Stats SA reported that employment grew by 248 000 in Q3, following a modest increase of 19 000 in Q2. Seven provinces recorded declines in official unemployment between Q2 and Q3, with Limpopo showing the largest improvement. However, the Eastern Cape saw a 1.7% increase, from 39.5% to 41.2%. Youth unemployment is a major concern, with rates at 38.4% for ages 25–34 and 58.5% for ages 15–24. High NEET (Neither in Employment, Education, or Training) levels among young people underscore the urgent need for targeted measures to boost job creation and economic growth.

Market overview

Global overview

Developed market (DM) equities rallied in the last few days of November to end in positive territory for the month. The MSCI World Index ended at 0.28% month-on-month (m/m) in US dollars, extending a run of positive monthly returns. Nvidia, the world’s most valuable company, announced better-than-expected results for its most recent financial quarter. Emerging market (EM) stocks lagged their DM peers in November and ended in negative territory, with the MSCI EM Index at -2.38% m/m in US dollars. Chinese equities were the biggest drag on the EM Index in November as they digested some of the strong year-to-date gains. The FTSE 100’s October gains continued into November, and ended up 0.37% m/m in pound terms. The S&P 500 ended November at 0.25% m/m compared to 2.34% m/m in the previous month, both in US dollars. Global bonds were in positive territory for November, at 0.23% m/m in US dollars, after the previous month’s losses. Global property was in negative territory in October but recovered in November, gaining 2.05% m/m in US dollars. The Euro Stoxx 50 Index gained 0.29% in November from October’s 2.53% m/m gain in euros. The Dow Jones Index gained 0.48% m/m in US dollars in November, below October’s 2.59% m/m gains. From being the biggest gainer in October, the Nikkei was a laggard in November, at -4.12% m/m in yen terms.

Local overview

The JSE was one of the best-performing global stock markets in November, with the FTSE/JSE All Share Index ending at 1.70% m/m in rand terms. Precious metal miners were back as the driving force of JSE returns in November. Gold and platinum miners were up in aggregate, boosted by a re-acceleration in precious metal prices. Resources posted gains in November, at 9.57% m/m, after recording -4.79% m/m in October. Both Property and Financials continued their gains into November, at 7.71% m/m and 1.76% m/m respectively, in rand terms. After posting losses in September and October, Industrials recovered in November with gains of 2.30% m/m. Cash was in positive territory for the month at 0.57% m/m in rand terms. The local bond market’s gains continued from October into November for short-, medium-, and long-term bonds. The FTSE/JSE All Bond Index ended November positively at 3.45% m/m in rand terms. Bonds of 1-3 years were positive at 0.82% m/m, along with bonds of 3-7 years at 1.64% m/m. Bonds of 7-12 years were positive at 3.20% m/m, and bonds of 12 years and above were the biggest gainer for the month at 5.38% m/m. The rand strengthened against the US dollar, euro and British pound by 1.20% m/m, 0.64% m/m, and 0.35% m/m respectively.

 

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