Global Economy

US: U.S. consumer spending rose 0.6% in August 2025, slightly above expectations of 0.5%, as households increased outlays on travel, dining, recreation, and essential services, keeping the economy on solid footing through Q3. Spending on services gained 0.5%, while goods purchases surged 0.8%, supported by higher expenditures on clothing, vehicles, gasoline, and food. The resilience in consumption comes despite a softening labor market, where job growth has nearly stalled over the past three months amid trade-policy uncertainty and tighter immigration. Personal income rose 0.4%, boosted largely by government transfers (+0.6%), while wages grew a modest 0.3%. With spending outpacing income, the savings rate fell to 4.6%, its lowest in eight months. Inflationary pressures also firmed as we noticed the PCE Price Index rose 0.3% MoM and 2.7% YoY, its fastest pace since February, while core PCE held steady at 2.9% YoY. Although high-income households are sustaining consumption through wealth effects from equities and housing, lower-income groups remain squeezed by tariffs and reduced benefits. The Fed’s recent 25bps cut to a 4.00%-4.25% range is unlikely to be followed by immediate further easing, with economists cautioning that spending momentum may fade toward year-end as inflation and labor market weakness weigh on households.

Sub-Saharan African Economies

China: China kept its benchmark lending rates steady for the fourth straight month in September 2025, leaving the one-year Loan Prime Rate (LPR) at 3.0% and the five-year LPR at 3.5%, in line with market expectations. The decision follows the People’s Bank of China’s move to hold its seven-day reverse repo rate, now the main policy rate, unchanged last week. The cautious stance reflects authorities’ preference for stability amid easing Sino-U.S. trade tensions, resilient exports, and a rally in domestic equities, with the Shanghai Composite Index hovering near 10-year highs, despite weak economic data. August saw the slowest growth in factory output and retail sales since last year, underlining domestic headwinds. Analysts at Barclays and Societe Generale still expect policy support later in the year, forecasting a potential 10bps rate cut alongside a 50bps reduction in banks’ reserve requirement ratio (RRR) in Q4, particularly as policymakers prepare for the fourth plenum in October to review the 15th Five-Year Plan proposals.

Nigeria: The Central Bank of Nigeria lowered its benchmark rate by 50 bps to 27% on September 23, 2025, the first cut since September 2020, following three meetings of no change. Slowing inflation and naira’s recent strength prompted the decision, with the goal of supporting economic growth. Nigeria’s annual inflation rate eased for the fifth month to 20.12% in August 2025, marking the softest reading since July 2022. Meanwhile, the economy expanded by 4.23% year-on-year in Q2 2025, the strongest pace of growth since Q2 2021, from 3.13% in the previous period.

South Africa: South Africa’s PPI inflation rose for the third month in August 2025, reaching a one-year high of 2.1%, compared to July’s 1.5%. Main upward pressure came from food, beverages & tobacco (4.3% vs 3.9% in July), notably meat, fish, fruit, vegetables, oils and fats (11% vs 10.4%). Conversely, declines were seen for coke, petroleum, chemical, rubber and plastic products (-1% vs -1.9%); paper and printed products (-0.5% vs -1.5%) and electrical machinery and communication and metering equipment (-1% vs 0.3%). On a monthly basis, producer prices rose by 0.3% in August, after a 0.5% increase in the prior month.

Domestic Economy

Major updates during the week:

  • The CBN’s MPC cut the policy rate by 50bps to 27.00%, adjusted policy tools including CRR and corridor settings, and signaled room for further easing as macroeconomic stability improves.
  • Nigeria’s GDP grew 4.2% y/y in Q2 2025, with services, industry, and agriculture driving output, while non-oil activities contributed nearly 96% of total GDP.
  • Nigeria’s House of Representatives inaugurated an ad hoc committee to review the sustainability and impact of the Naira-for-Crude Oil policy, a long-term initiative aimed at reducing FX dependence, boosting local refining, and strengthening energy security.

Nigerian equity market: Industrial goods tickers  lead gains as equities extend bullish run into third week

The Nigerian equities market extended its bullish momentum into a third consecutive week, recovering from early losses in the first three trading days. The rebound was supported by strong activity across the Industrial, Banking, and Consumer Goods sectors. The NGX All-Share Index gained 0.20% to close at 142,133.02 points, while market capitalization advanced 0.24% week-on-week to N89.96 trillion, partly boosted by the listing of 3.17 billion FCMB shares following a debt-to-equity conversion. Market performance was mixed, with 32 gainers , while 51 equities declined. On a sectoral basis, three of the five key indices closed higher, with the Industrial Goods sector leading the gainers at +1.33% WoW. Overall, investor sentiment remained positive, keeping the market on an upward trajectory despite significant sell-offs in select counters.

Nigerian fixed-income market: CBN MPC cuts benchmark rate by 50 basis points to 27%

The Nigerian fixed-income market recorded a largely positive performance this week, supported by strong system liquidity ranging between ₦1.8 trillion and ₦3.7 trillion and expectations of monetary easing by the Monetary Policy Committee. In the treasury bills market, robust demand drove yields lower across the curve, with the average yield declining by 49 basis points to 18.00%. Meanwhile, activity in the bond market was more cautious as investors positioned ahead of next week’s scheduled auction. Nevertheless, average bond yields edged down by 8 basis points to 16.51%. In contrast, Eurobond trading was relatively muted, reflecting mixed sentiment across maturities, with the average yield inching higher by 1 basis point to 7.98%. Looking forward, we anticipate cautious trading as investors monitor potential catalysts that could drive yields higher.