Market Summary by AFORTI: US government shutdown, rising unemployment in the Eurozone, interest rates in Poland

2025-10-06

Last week markets were focused on the US government "shutdown," which, despite suspending key data, did not prevent the dollar and S&P 500 from strengthening. Europe recorded an increase in unemployment in the eurozone, while inflation decline in Poland increased chances for an interest rate cut. Among assets, gold continued its record rally, and Bitcoin and the WIG Index rose, while Brent crude oil and EUR/PLN and USD/PLN rates fell. In the coming week, attention will focus on the MPC decision regarding interest rates and on speeches by ECB and Fed presidents.

Economic indicators

Poland

1. CPI Index (y/y) (September) P: 2.9%; forecast: 2.9%; previously: 2.9%

2. CPI Index (m/m) (September): 0.0%; forecast: ; previously: 0.0%

3. PMI Index for manufacturing (September): 48.00; forecast: 46.40; previously: 46.60

Eurozone

1. CPI Index (y/y) (September) P: 2.2%; forecast: 2.2%; previously: 2.0%

2. PMI Index for manufacturing (September): 49.8; forecast: 49.5; previously: 50.7

3. S&P Global Composite PMI Index (September): 51.2; forecast: 51.2; previously: 51.0

4. PMI Index for services (September): 51.3; forecast: 51.4; previously: 50.5

5. PPI Index (m/m) (August): -0.3%; forecast: -0.1%; previously: 0.3%

6. PPI Index (y/y) (August): -0.6%; forecast: -0.4%; previously: 0.2%

Germany

1. CPI Index in Germany (m/m) (September) p: 0.2%; forecast: 0.2%; previously: 0.1%

2. Unemployment change in Germany (September): 14K; forecast: 8K; previously: -9K

3. Unemployment rate in Germany (September): 6.3%; forecast: 6.3%; previously: 6.3%

4. CPI Index in Germany (y/y) (September) P: 2.4%; forecast: 2.3%; previously: 2.2%

5. PMI Index for manufacturing in Germany (September): 49.5; forecast: 48.5; previously: 49.8

6. PMI Index for services in Germany (September): 51.5; forecast: 52.5; previously: 49.3

France

1. CPI Index in France (y/y) (September) P: 1.2%; forecast: 1.3%; previously: 0.9%

2. HICP Index in France (y/y) (September): 1.1%; forecast: 1.3%; previously: 0.8%

3. Consumer spending in France (m/m) (August): 0.1%; forecast: 0.3%; previously: -0.6%

4. PMI Index for manufacturing in France (September): 48.2; forecast: 48.1; previously: 50.4

5. Industrial production in France (m/m) (August): -0.7%; forecast: 0.3%; previously: -0.1%

6. PMI Index for services in France (September): 48.5; forecast: 48.9; previously: 49.8

United Kingdom

1. GDP (q/q) (Q2): 0.3%; forecast: 0.3%; previously: 0.7%

2. GDP (y/y) (Q2): 1.4%; forecast: 1.2%; previously: 1.7%

3. Current account (Q2): -28.9B; forecast: -24.8B; previously: -21.2B

4. Private net debt (August): 6.000B; forecast: 6.300B; previously: 6.144B

5. Composite PMI (September): 50.1; forecast: 51.0; previously: 53.5

6. PMI Index for services (September): 50.8; forecast: 51.9; previously: 54.2

USA

1. Job Openings and Labor Turnover Survey (JOLTS) - USA (August): 7.227M; forecast: 7.190M; previously: 7.208M

2. Crude oil inventories: 1.792M; forecast: 1.500M; previously: -0.607M

3. Chicago PMI Index (September): 40.6; forecast: 43.4; previously: 41.5

4. Pending Home Sales Index (m/m) (August): 4.0%; forecast: 0.2%; previously: -0.3%

5. S&P/CS Composite-20 HPI Index, not seasonally adjusted (m/m) (July): -0.3%; forecast: ; previously: 0.0%

6. API Weekly Crude Oil Stock: -3.674M; forecast: ; previously: -3.821M

7. Cushing Crude Oil Inventories: -0.271M; forecast: ; previously: 0.177M

8. S&P Global Composite PMI Index (September) P: 53.9; forecast: 53.6; previously: 54.6

9. PMI Index for services (September) P: 54.2; forecast: 53.9; previously: 54.5

10. ISM Services Employment Index (September): 47.2; forecast: 46.6; previously: 46.5

China

1. Caixin Services PMI Index (September): 52.9; forecast: 52.4; previously: 53.0

2. Composite PMI Index in China (September): 50.6; forecast: ; previously: 50.5

3. PMI Index for services (September): 50.0; forecast: 50.3; previously: 50.3

4. Caixin Manufacturing PMI Index (m/m) (September): 51.2; forecast: 50.3; previously: 50.5

Currency market:

This week the euro (EUR) weakened against the zloty (PLN) by 0.28%. The euro price oscillated in the range of 4.2490 – 4.2711.

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Similarly, the dollar (USD) weakened against the zloty (PLN) by 0.08%. The dollar price oscillated in the range of 3.6172 – 3.6464.

Oil and gold market

BRENT oil price fell by as much as 7.62%. The price oscillated in the range of 64.05 – 68.92 USD/barrel.

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Gold, however, increased by 3.24%, breaking peak values for the 7th consecutive week. The gold price oscillated in the range of 3,794.07 – 3,922.02 USD/ounce.

Stock Exchange

The WIG index increased by 1.36%. The WIG index price oscillated in the range of 105,564 – 108,702.

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Cryptocurrencies

The price of Bitcoin (BTC) rose by as much as 8.74%. The Bitcoin price oscillated in the range of 399,998 – 441,200 zlotys.

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Important events from last week

US Government Shutdown: The shutdown of the United States federal government began on Wednesday, October 1, 2025, due to a lack of agreement in Congress regarding budget funding for the new fiscal year. The consequence of this event was massive, unpaid leave for about 750 thousand officials and the suspension of key administration functions, which for markets meant blocking the publication of important macroeconomic data. Despite the chaotic situation, in which the publication of the key payrolls report was in question, the US dollar unexpectedly strengthened on a day-to-day basis. As a result, the EUR/USD rate approached 1.17, suggesting that the market initially did not react with panic, and even the American stock index S&P 500 recorded an increase.

Rising unemployment in the Eurozone: The unemployment rate in the eurozone, after adjusting for seasonal factors, slightly increased in August 2025. According to Eurostat's announcement, this indicator reached 6.3%, which represents an increase from 6.2% recorded in the previous month. Among the currency union countries, the highest unemployment rate was recorded in Spain (10.3%), while Poland ranked 3rd with the lowest reading at 3.2%.

Inflation decline in Poland: The September reading of consumer inflation (CPI) in Poland surprised financial markets, stabilizing at 2.9% year-on-year, contrary to expectations of an increase to 3.0%. The entire positive surprise was concentrated in food prices, which recorded a decrease of 0.5% on a month-to-month basis. Lower-than-expected inflation reading caused decreases in Polish Treasury bond (SPW) yields at the beginning of the week. These data increased the chance for an interest rate cut by the Monetary Policy Council (RPP) as early as the October meeting, which helped stabilize the Polish zloty (PLN) rate slightly below 4.26 against the euro.

Historic gold record: On global financial markets, attention was focused on gold, whose spot market quotations for the first time in history exceeded the level of 3,896 USD per ounce. This meant that the precious metal ended the seventh consecutive week on the plus side, becoming more expensive by nearly 50% since the beginning of the year. Analysts indicate that the record is driven by strong purchases from both central banks and private investors (through ETFs), which exceeded earlier forecasts. This dynamic growth is interpreted as real portfolio diversification and protection against growing macroeconomic and political risks, including consumer uncertainty in the US and the ongoing shutdown.

Gaza Peace Plan: US President Donald Trump and Israeli Prime Minister Benjamin Netanyahu announced a joint, 20-point peace plan for the Gaza Strip, assuming an immediate end to the conflict and the creation of temporary stabilization forces. Key conditions include the release of hostages by Hamas in exchange for the withdrawal of Israeli troops and amnesty for disarmed Hamas members, to which Hamas has tentatively agreed on the issue of prisoner exchange. As a result, Israel halted a major offensive on Trump's order, although diplomats in Cairo are still negotiating the details of a lasting ceasefire. At the same time, opposition is growing in the US – more than half of American voters declare their opposition to further financial and military aid to Israel.

Events worth noting this week

Prospects for the zloty: The key event for the Polish zloty will be the Monetary Policy Council (RPP) decision on interest rates on Wednesday, October 8, 2025. The market expects rates to remain at 4.75%, although after the recent lower CPI inflation reading, some investors see a chance for a cut. The decision to cut rates could lead to a weakening of the zloty, especially in the context of warnings about a high budget deficit limiting room for maneuver. Investors will also analyze the MPC Meeting Protocol published on Thursday, October 9, and the NBP conference, in search of clues about future policy.

Prospects for the euro: The euro will be affected on Monday, October 6, by data on Retail Sales (m/m) in the eurozone, providing early information on the condition of consumption. On Wednesday, October 8, attention will focus on the publication of data on Industrial Production (y/y) in Germany, which is an important barometer for the region's largest economy. Investors will particularly closely follow the evening speech by ECB President Christine Lagarde on Wednesday, October 8. Her comments on future monetary policy or inflation prospects may strongly influence EUR currency rates.

Prospects for the dollar: The main risk factor for the US dollar remains the ongoing US government shutdown, which has suspended the publication of key economic data, including the employment report. A sudden end to the paralysis could cause an avalanche of publication of delayed reports, immediately affecting the outlook for FOMC policy. The market will also react to Fed Chairman Powell's speech scheduled for Thursday, October 9, in search of clues regarding interest rates. Additionally, on Friday, October 10, the publication of the Unemployment Rate (Sep) is planned, which is expected to be 4.3%.

Prospects for the pound: For the British pound, an important indicator is the PMI Index for the construction sector (Sep), which will be published on Monday, October 6. Markets will also closely follow the speech of BoE President, Bailey, also on Monday, which may outline the direction of the Bank of England's monetary policy. Indicators such as PMI provide important information about the current condition of the UK economy. Additional information regarding the labor market may appear in the Minutes from the BoE FPC meeting on Wednesday, October 8.

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