Weekly Economic Outlook: October 13 - October 19, 2025
- Remin Francis I R
- Oct 21
- 2 min read
The past week brought a mix of steady progress and subtle shifts across key global and domestic indicators, reflecting the ongoing tug-of-war between inflation, employment, and trade dynamics.
Starting with the United Kingdom, the unemployment rate ticked up to 4.8% in the three months to August, slightly above market expectations of 4.7%. This marks the highest reading since mid-2021. The increase mainly came from those unemployed for up to six months and those jobless for over a year. Interestingly, the number of employed individuals actually rose by 91,000 to 34.2 million, driven mostly by part-time roles and workers aged 65 and above, showing that while jobs are being added, many might be part-time or temporary in nature.
Back home, India’s wholesale inflation cooled significantly in September. Headline WPI rose just 0.13% year-on-year, well below the 0.5% forecast and slower than August’s 0.52%. The moderation came largely from food prices, which fell 1.99% year-on-year, a sharp reversal from the slight rise in August. Prices of onions (-63.79%), potatoes (-42.24%), and pulses (-17.19%) fell notably. Manufacturing inflation also eased to 2.33%, reflecting softer price pressures across multiple sectors, including food products and cement.
Fuel prices continued their downward streak, falling 2.58% year-on-year, the sixth straight monthly decline, as global energy prices stayed subdued.
In China, inflation remains a concern of a different kind. Consumer prices fell 0.3% year-on-year in September, marking another month of deflationary pressure. Food prices, particularly pork, dropped sharply amid oversupply, even as non-food inflation inched higher thanks to government trade-in schemes and steady consumer spending in categories like clothing and healthcare.
On the domestic front, India’s passenger vehicle sales fell 9.2% year-on-year in September, following a similar drop in August. However, there’s a silver lining: sales rebounded 11.4% month-on-month, helped by the new GST 2.0 reforms that came into effect in late September, injecting optimism into the auto sector.
Trade data, however, painted a more cautious picture. India’s merchandise trade deficit widened sharply to USD 32.15 billion in September, the largest since November 2024. Imports surged 16.7% to USD 68.53 billion, led by gold, while exports grew a modest 6.1%, partly due to delays in the US-India trade deal.
Lastly, the unemployment rate in India edged up slightly to 5.2% in September from 5.1% in August. While rural and female unemployment rose marginally, both the employment rate (52.4%) and labour force participation rate (55.3%) climbed to their highest levels since April, a sign that more people are re-entering the job market.
India’s forex reserves dipped slightly to USD 697.78 billion as of October 10, down from USD 699.96 billion the previous week, but they remain comfortably high by historical standards.
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