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Daily Economic Update
10.12.2025
US: Mixed JOLTS data as job openings rise but hiring falls and layoffs increase. The JOLTS report for October and concurrently released delayed September data showed that job openings in October unexpectedly increased to a five-month high of 7.67 million from 7.66 million in September and 7.23 million in August. The rise in vacancies was mostly concentrated in the trade, transportation and utilities sectors, ahead of the Thanksgiving holiday shopping period, along with healthcare. However, the hiring rate fell back to 3.2% from September’s 3.4% (3.2% in August) while the layoff rate ticked up to a 13-month high of 1.2% from 1.1% in September. The quits rate dropped to the lowest since April 2020 at 1.8% versus September’s 2%, indicating weakening confidence among job-switchers. Overall, despite higher vacancies, the October JOLTS report highlights the softening trend in labor market conditions, given decreased hiring and quits as well as increased layoffs. These data points are unlikely to alter the FOMC decision later today, with a 25 bps interest rate cut firmly expected by the market.
China: Consumer prices increase at the fastest pace in 21 months on higher food prices. CPI inflation climbed to 0.7% y/y in November, up from 0.2% in October but in line with expectations, marking its highest level in 21 months. The higher y/y inflation reading was driven by base effects given that prices decreased by 0.1% m/m. Food prices rose for the first time in ten months, increasing 0.2% y/y versus a 2.9% drop in October, supported by rebounds in fresh vegetables (+14.5%) and fruits (+0.7%) and a milder decline in meat (-6.6%), likely driven by colder weather and base effects from last year. Core inflation, excluding food and energy, held steady at 1.2% y/y in November, matching October and remaining at its highest level in 21 months. Meanwhile, producer prices continued to decline for the 38th consecutive month, slipping slightly to -2.2% y/y in November. The inflation readings are somewhat mixed, continuing to signal a soft or mildly deflationary bias overall, but with both headline and core inflation touching multi-month highs in year-on-year terms.
UAE: IMF sees strong economic growth in 2026 under a prudent policy framework. According to the IMF’s latest Article IV report, the UAE economy is projected to sustain robust growth in 2026, with GDP seen expanding by 5%, driven by a 6.3% rebound in oil output and solid non-oil sector growth of 4.6%. Inflation is expected to remain contained at 2%, while the fiscal and external positions will stay strong despite gradual moderation, with the fiscal surplus easing but the debt ratio declining (to 32.4% of GDP in 2026). The report highlights the UAE’s resilience to recent global shocks, which had only a limited impact, reinforcing its status as an attractive investment destination. IMF staff applauded the strengthening of tax administration through targeted reforms aimed at boosting revenue and supporting non-oil activity and emphasized the need for a comprehensive public-sector fiscal perspective given the significant role of GREs and SWFs. UAE authorities acknowledge this but also note challenges as many entities operate under different emirate-level mandates. The report also stated that the real estate sector continues to benefit from favorable conditions, though persistent price increases and emerging risks from tokenization warrant close monitoring and coordinated policies to safeguard stability and affordability. Authorities, however, stressed that any slowdown would have limited impact on the banking system given low exposures. Monetary policy enhancements including the rollout of final repo and reverse repo facilities in early 2026 and the implementation of a 0.5% countercyclical capital buffer, would help in deepening money markets and ensuring that banks maintain additional capital to absorb potential shocks. These measures, alongside systematic fiscal risk assessments, will reinforce macroeconomic stability and support the UAE’s diversification agenda in the medium to long term.
Qatar: Approved budget sees fiscal deficit widening in 2026. The government has approved a general budget for 2026, with total revenues seen rising by 1% from last year’s budget to QR199 billion despite a downgrade to the oil price assumption to $55/bbl from $60/bbl previously. Meanwhile, expenditures are set to increase by 5% to QR221 billion, expanding the fiscal deficit to QR22 billion (2.5% of GDP on our forecast for GDP) for next year, the largest since 2017, which will be covered through local and external debt instruments according to finance minister Al-Kuwari. That will mark the second consecutive annual deficit for Qatar, with the state recording a QR2 billion (<1% of GDP) deficit so far during 9M25. Nevertheless, the actual deficit in 2026 turnout could be smaller than projected, especially if extra LNG volumes from the North Field East expansion can be marketed before year-end and if oil prices hold above $60/bbl, which is our baseline assumption going into 2026. Still, the fiscal deficit should remain transitory, with multiple, large-scale LNG projects coming online between 2026 and 2030 that are set to almost double LNG production capacity to 140 MTPA, boosting the government’s hydrocarbon receipts.