Gold’s Roar, Powell’s Whisper - A Macro Pilgrim's Ledger (September 28, 2025)
Gold surged $100 while Powell warned there’s no “risk-free path.” Is this rally safety...or a signal of storm clouds ahead?
“Walking the path of global markets, one step at a time.”
Policy guidance again set the tone, led by Chair Powell’s remarks in Rhode Island.
Equities broke their streak of gains and finished lower. Bonds were mixed, with front-end yields steady while the long end weakened.
The dollar firmed as positioning turned cautious. Gold surged by more than 100 dollars and closed near record highs.
The VIX spiked midweek and then faded into the close, leaving implied volatility contained despite the equity pullback.
Powell described policy as modestly restrictive, emphasized that there is no risk-free path, and reiterated that decisions will remain data-dependent as inflation risks and employment risks pull in opposite directions.
Confidence remained fragile. Relief was brief, and the uneven reaction across assets showed how quickly sentiment shifts as markets parse every policy nuance.
“Gold is a refuge from political instability, economic uncertainty, inflation, deflation, and currency depreciation.” — Steve Forbes
The Week That Was
Monday saw mixed signals across housing and sentiment.
The Case-Shiller Home Price Index for August posted modest gains, reflecting continued demand pressure in real estate markets.
U.S. Consumer Confidence softened slightly, with the index dipping about 5 percent from last month, and sentiment weakened most among lower-income and independent households.
In Japan, Tokyo CPI rose in September, reinforcing concerns that inflation remains sticky even as the BoJ begins to step away from full stimulus.
Tuesday brought more clarity on business and housing.
Durable Goods Orders (August) disappointed expectations, with new orders contracting and suggesting that capital spending may be cooling.
Existing Home Sales (August) also came in below consensus, pointing to weaker housing activity.
At the same time, the Eurozone Flash PMI (September) offered a glimmer of relief.
Manufacturing and services indices held roughly steady, although the forward-looking components signaled softening growth expectations.
Wednesday delivered a mixed bag.
The FHFA Home Price Index for August showed continued upward momentum in U.S. home prices, underscoring supply constraints.
On the flipside, New Home Sales came in softer than forecast, confirming that affordability pressures may be weighing.
Later, the Bank of England Governor’s speech struck a cautiously hawkish tone.
While he acknowledged economic headwinds, he stopped short of signaling imminent cuts, reinforcing the BoE’s wait-and-see posture.
Thursday underscored weakness in the labor and income fronts.
Initial Jobless Claims ticked higher, hinting at emerging strain in the labor market.
Personal Income and Personal Spending data revealed that while incomes held up, spending growth slowed, particularly in discretionary categories.
Meanwhile, Canada’s CPI (August) surprised to the upside, with inflation remaining elevated and pressuring the Bank of Canada’s flexibility to ease.
Friday was the pivotal moment. Core PCE (August), the Fed’s preferred inflation gauge, came in at plus 0.3 percent month over month, bringing year-on-year core inflation to 2.9 percent, unchanged from July.
The stable reading dashed hopes of a swift disinflation.
In tandem, Consumer Sentiment (final September) in the U.S. confirmed the early-month reading, slipping about 5 percent from August amid broad softness in income and business expectations.
Macro / Policy
Chair Jerome Powell’s Rhode Island remarks set the tone.
He described policy as modestly restrictive, reiterated that there is no risk-free path, and stressed decisions will remain data-dependent in light of upside risks to inflation and downside risks to employment.