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Daily Economic Update
12.11.2025
UK: Labor market indicators weaken further ahead of the Autumn Budget. UK payrolls (based on employment tax records) reversed the tentative stabilization trend seen previously, falling by 32K m/m in October, matching September’s downwardly revised drop. Though monthly payroll data is usually subject to significant revisions in subsequent months, the latest figures indicate that the UK economy has lost 180K jobs in the past twelve months. Moreover, the unemployment rate rose more than forecast to 5% in the July-September period from 4.8% in June-August, the highest since December 2020-February 2021, though the participation rate was steady at 63.9%, its best reading since the start of the pandemic in 2020. Pay metrics also weakened, with regular wage growth slowing to the lowest level since February-April 2022 at 4.6% y/y in July-September from 4.7% in June-August, with total pay rises also moderating to 4.8% from 5%. Job vacancies were mostly flat at 723K in August-October, near their lowest level in four and a half years. The softening pace of job declines in prior months had raised hopes that the worst was possibly behind us, but the renewed weakness has now tempered those expectations. Businesses continue to be cautious ahead of the announcement of the government’s budget later this month, which is weighing on the job scene and broader economic activity. However, the weak employment prints should also push the Bank of England to resume its interest rate cuts, with the futures market now signaling around 80% probability of a 25-bps rate cut at the December meeting.
Saudi Arabia: Industrial production rose sharply in September. Official monthly data from GASTAT showed the Industrial Production Index rising by a series-high of 9.3% y/y in September, up from 6.9% the previous month, driven by much faster growth in both oil and non-oil activities. Oil output expanded by a multi-year high of 10.1% y/y (from 7.6% in August) on the back of the continued phasing out of previous oil production cuts, while non-oil output rose by 7.3% (from 5.1% in August), the fifth consecutive month of expansion and the fastest increase in over a year. Under non-oil activities, manufacturing (excluding refining) rose by 6.5% y/y, led by food products (13.1%), non-metallic products (10.4%) and chemical products (9.2%) manufacturing. Meanwhile, electric/gas and water supply continued to rise at a fast pace. The sustained strong growth in non-oil production is consistent with the ongoing efforts to increase industrial capacity under Saudi Arabia’s Vision 2030 diversification goals.
