Fed Rate Cut Bets, Political Shifts in Japan and France, and Gold’s Record Surge: PALvatar Market Recap, September 8 2025

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1:24The Real Rao will be back with Julian Battelle tomorrow on the latest Shooting the Shit. So tune in then to find out what the guys think of the macro landscape. For now, here's what I've got for you. Politics and central bank moves are at the forefront of investors' minds today. The non-farm payrolls report from Friday, which showed the US economy added only 22 ,000 jobs in August, has made a Fed rate cut next week of virtual certainty and boosted global stocks today. Japan's Nikkei was the best performer in Asia after the resignation of Prime Minister Shigeru Ishiba on Sunday. He was in power for less than a year, and in that time, his party lost the majority in both houses of parliament over two elections, a situation not seen since 2012, and attributed primarily to rising living costs.

2:12He said he'd remained in his position to oversee the implementation of a trade agreement with the US. Japan isn't the only country lately that's going through prime ministers like broken toys. France's government is on the brink of collapse, with the Prime Minister facing a confidence vote in Parliament today that he's expected to lose. This means the French could have a 5th PM in less than two years, enough to make you shout Sacré Bleu. The revolving doors come at a peculiar time for the country. It faces a ratings review by Fitch this week, followed by two other agencies later this year. Better news from Germany, where industrial production rose unexpectedly by 1.3 % month-over-month for July after a decline in June.

2:55Despite that, wider concerns about economic growth in the Eurozone persist, as reflected in declining investor sentiment indices like Centix dropping to minus 9.2 from minus 3.7 previously. China is also facing some challenges. Exports grew in August at the slowest pace in six months, dragged by a 33 % drop in shipments to the US. Imports also took a hit. Meanwhile, gold prices have surged to record highs, above$3 ,600. Reuters says the likely Fed rate cut has added fuel to the rally over the past 18 months, on top of a weaker dollar, purchases by central banks, downward interest rates globally and geopolitical uncertainty.

3:38Another commodity, oil, has also risen in price today after OPEC Plus raised output over the weekend by less than expected. Looking ahead, we've got US wholesale inflation on Wednesday and the consumer price index on Thursday. That's also when the European Central Bank votes on its interest rates, although we're not expecting any action. Make sure to tune in to Macro Mondays with Andrea Steno and Mikkel Rosenwald today for an in-depth breakdown of this week's action. I'll see you again tomorrow.