Summary of September 2025 Market Update

In September 2025, global equity markets rallied as investors increasingly anticipated interest-rate cuts from the Federal Reserve — a move that ultimately took place at the end of the month. Economic data were mixed: Canada reported stronger-than-expected GDP for July followed by a stall in August, inflation remained below the Bank of Canada’s 2% target, and unemployment edged higher. Both the Bank of Canada and the U.S. Federal Reserve implemented rate cuts that helped push down 10-year government bond yields.

Canadian equities reached new record highs, with the materials sector among the top performers. Internationally, China showed signs of economic slowdown, prompting expectations of further policy support. Safe-haven demand pushed gold to record levels while oil prices eased.

Key highlights

  • The U.S. Federal Reserve cut the federal funds rate by 0.25% (to 4.00–4.25%) and signalled additional cuts later in the year amid softer labour-market readings and moderating inflation.
  • Canada’s economy displayed a mixed monthly profile; the Bank of Canada moved to cut its key policy rate as inflation cooled.
  • 10-year government bond yields fell in response to easing monetary policy expectations.
  • China’s growth indicators (retail sales, industrial production, exports) weakened, increasing expectations of policy support from Beijing.
  • Gold climbed to record highs (above US$3,800/oz) as investors sought safety, while oil prices slipped.

For the full update and data tables, read the original post on Canada Life: Monthly Market Update – September 2025.