Week commencing 17 November 2025

ASX 200 falls as RBA minutes and US fed outlook dominate

United States (US) equity indices experienced mixed fortunes this week, with investors offloading overstretched technology names in favour of the blue-chip Dow Jones, which is well positioned to benefit from potential Federal Reserve (Fed) rate cuts and the reopening of the US government.

Locally, the Australia 200 (ASX 200) is poised for a third consecutive week of declines, heavily influenced by a 10.5% drop in Commonwealth Bank of Australia (CBA) shares – which account for a 12% weighting in the index – and further pressured by a robust October labour market report that has dimmed expectations for future Reserve Bank of Australia (RBA) rate cuts.

The week that was: highlights

• In the US, private employers shed an average of 11,250 jobs per week, over the four weeks ending October 25, 2025
• In the United Kingdom (UK), the unemployment rate rose to 5.0% in September from 4.8% prior, the highest level in four years
• UK third quarter (Q3) gross domestic product (GDP) rose by a tepid 0.1% easing from 0.3% in the prior quarter
• In Australia (AU), the Westpac Consumer Sentiment Index for November surged 12.8% to 103.8
• The Australian economy added 42,200 jobs in October. This saw the unemployment rate ease to 4.3% from 4.5% prior on an unchanged participation rate of 67%
• In New Zealand (NZ), the Business NZ PMI rose to 51.4 in October from 50.1 prior
• Crude oil fell 0.84% to $59.30
• Gold surged 4.63% to $4186
• Bitcoin fell 5.55% to $98,914
• Wall Street's gauge of fear, the volatility index (VIX), rose to 19.99 from 19.08 the previous week

Key dates for the week ahead

Australia & New Zealand

• AU – RBA meeting minutes: Tuesday, 18 November at 11.30am AEDT
• AU – S&P Global purchasing managers’ index (PMI): Friday, 21 November at 9.00am AEDT

China & Japan

• JP – Q3 GDP: Monday, 17 November at 10.50am AEDT
• JP – Inflation: Friday, 21 November at 10.30am AEDT

United States

• US – Industrial production: Wednesday, 19 November at 1.15am AEDT
• US – Housing starts: Thursday, 20 November at 12.30am AEDT
• US – Federal Open Market Committee (FOMC) meeting minutes: Thursday, 20 November at 6.00am AEDT
• US – Initial jobless claims: Friday, 21 November at 12.30am AEDT
• US – Existing home sales: Friday, 21 November at 5.40am AEDT
• US – S&P Global flash PMI: Saturday, 22 November at 1.45am AEDT

Europe & United Kingdom

• UK – Inflation: Wednesday, 19 November at 6.00pm AEDT
• UK – S&P Global flash PMI: Friday, 21 November at 8.30pm AEDT

Key events for the week ahead

AU: RBA meeting minutes

Date: Tuesday, 18 November at 11.30am AEDT

At its last meeting in November, the RBA kept its cash rate on hold at 3.60% as widely expected. The decision to keep rates on hold was unanimous.

The RBA noted that while inflation has fallen substantially since its peak in 2022, more recently inflation has picked up. The RBA’s revised forecasts that accompanied the rates decision showed it expects trimmed mean inflation to rise to 3.2% during the first half of 2026 before easing back to 2.7% by December 2026.

The RBA noted that despite the unexpected rise in the unemployment rate to 4.5% in September, ‘various indicators suggest that labour market conditions remain a little tight’.

In the post-meeting press conference, Governor Michele Bullock clarified that neither a rate hike nor a cut was considered, emphasising a data-dependent stance. The RBA acknowledged that rates remain slightly restrictive – though confidence in this assessment has waned – and suggested that a ‘small cut’ might be appropriate in the future, though it equally might not be warranted.

This balanced perspective proved prescient following the release of the October labour force report this week, which revealed the Australian economy added 42,200 jobs and the unemployment rate fell to 4.3% from 4.5%.

Market expectations for the upcoming minutes: 

Investors will seek clarity on the Board’s assessment of the recent uptick in inflation, particularly whether it views the 3.2% trimmed mean forecast as a temporary blip or a more persistent challenge that may require tighter policy.

Additionally, the market will focus on any nuanced shifts in the RBA’s tone around data dependency and uncertainty, as it could signal the RBA’s readiness to pivot – either toward cuts if growth falters further or toward hikes if inflationary pressures intensify.

RBA cash rate chart

JP: Q3 GDP

Date: Monday, 17 November at 10.50am AEDT

In the second quarter (Q2), Japan’s economy grew by 2.2% on an annualised basis, exceeding the initial estimate of 1.0%.

This marked a sharp acceleration from the 0.3% growth recorded in the first quarter (Q1) and represented the fifth consecutive quarter of annual growth and the fastest pace since Q3 2024.

The expansion was driven by resilient private consumption, bolstered by government measures that mitigated cost pressures from rising food – particularly rice – and energy prices.

Additionally, capital spending increased for the third consecutive quarter, fuelled by expectations of monetary tightening, heightened investment in labour-saving technologies, digitalisation and efforts to diversify supply chains.

A notable positive contribution came from net trade, with exports surging due to firms front-loading shipments to the US ahead of the newly imposed 15% blanket tariffs.

Preliminary expectations for Q3 GDP are for a fall of -2.5% on an annualised basis, reflecting a sharp slowdown from the previous quarter.

This tempered outlook is attributed to factors including the fading boost from front-loaded exports as US tariffs settle, potential softening in private consumption due to persistent inflation pressures and political uncertainty.

Japan GDP growth annualised chart

US: FOMC meeting minutes

Date: Thursday, 20 November at 6.00am AEDT

The Fed’s most recent FOMC meeting, held on 28 - 29 October 2025, resulted in a widely anticipated 25 basis point (bp) rate cut, lowering the target range for the federal funds rate to 3.75% - 4.00%.

This marked the second consecutive cut following a 25 bp reduction in September, reflecting the Fed’s ongoing efforts to support a labour market showing signs of softening while managing persistent inflationary pressures.

Fed Chair Jerome Powell emphasised a cautious approach, noting that ‘a further reduction in the policy rate at the December meeting is not a foregone conclusion’, dampening expectations of another rate cut before year end.

The minutes of the October FOMC meeting will be keenly scrutinised for deeper insights into the Fed’s deliberations and the level of consensus – or dissent – among FOMC members regarding the 25 bp cut, particularly after Powell’s tempered remarks suggested a growing chorus to ‘wait a cycle’ before the next move.

This week, several Fed speakers have contributed to the discourse, with the overall tone remaining cautious and data-dependent, reflecting a preference for flexibility over commitment to a specific monetary policy direction, particularly regarding a December rate cut.

The collective sentiment carries on the hawkish undertone from the FOMC meeting, as Fed officials navigate persistent inflationary pressures and a softening labour market, complicated by the absence of key data points due to the recent US government shutdown.

Fed funds rate chart

US Q3 earnings season

US Q3 2025 earnings season continues next week, with reports scheduled from companies including Home Depot, Target, Walmart and Nvidia.