Economic Outlook - November 2025
- On October 1, the United States government was shut down after Congress was not able to pass a bill to continue to fund all federal agencies. This has left the country with many questions as we continue forward in uncertain territory approaching the longest government shutdown in history, which lasted 34 days. The shutdown has caused stress for many Americans, ranging from loss of jobs to questioning whether they will receive food from the Supplemental Nutrition Assistance Program (SNAP). The closure has also affected the economic data that is gathered and reported by the government, such as labor data released by the U.S. Bureau of Labor Statistics.
- Inflation continues to trend higher than the Federal Reserve’s (Fed) desired target of 2%. The Consumer Price Index in September came in at 3%. This is up slightly from the August report of 2.9% and fuels the debate on whether future rate cuts are necessary, or if they will spark inflation fears again.
- The Fed decided to cut rates in October by 25 basis points, reducing the Fed’s benchmark short-term interest rate target to 3.75% – 4%. Fed Chair Jerome Powell was very clear in his message to the market at the end of October that a rate cut in December was far from a done deal. With this most recent cut, the short-term rate is the lowest in three years, and Powell noted that a “growing chorus” of officials are debating an additional cut in 2025. The stock market has had a strong year; however, Powell described the September rate cut as necessary for “risk management” with evidence of rising unemployment and weakening in the labor market.
- Effects of Artificial Intelligence (AI) on the workforce started to appear in October with multiple companies announcing major layoffs of white-collar workers. Amazon was the latest firm, joining UPS and Target, stating they may be eliminating as much as 10% of their white-collar employees. Amazon shares jumped after their quarterly release as investors celebrated strong revenue and earnings growth, but many questions remain for the broader workforce with the potential future impact of AI on their jobs.
- The price of gold hit an all-time high in October with the price soaring above $4,000 an ounce for the first time in history. Past rallies in the price of gold have occurred during volatile times, such as the pandemic and the great financial crisis of 2007 – 2009. This rally seems to be fueled by concerns regarding the underlying strength of the U.S. economy and movement away from dollar-based assets. Another alternative asset that is performing well, potentially due to economic uncertainty and rising geopolitical tensions, is Bitcoin. The cryptocurrency also hit an all-time high in the month of October, but many investors and economists still view the digital asset as speculative.
Sources: FactSet, Board of Governors of the Federal Reserve System, U.S. Department of Commerce
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