SC GDP Growth Rate YoY: September 2025 Release and Macro Outlook
Table of Contents
The September 2025 GDP Growth Rate YoY for SC registered 4.60%, a marked slowdown from the 10.10% recorded in June 2025. Despite this deceleration, the figure comfortably exceeded the 2.70% market consensus, signaling resilience amid global headwinds. This release, sourced from the Sigmanomics database, reflects a complex interplay of domestic recovery and external pressures.
Drivers this month
- Domestic consumption growth slowed but remained positive at 2.30% contribution.
- Export volumes rebounded, adding 1.10 percentage points (pp) to growth.
- Investment activity contracted slightly, subtracting 0.40 pp.
- Government spending remained steady, contributing 0.80 pp.
Policy pulse
Monetary policy remains moderately tight, with the central bank maintaining interest rates near 5.25%, aiming to balance inflation control and growth support. Inflation currently hovers around 3.40%, close to the target band, allowing some policy flexibility.
Market lens
Financial markets showed a muted reaction post-release. The SCR currency appreciated 0.30% against the USD within the first hour, while 2-year government bond yields edged up 5 basis points, reflecting cautious optimism about growth sustainability.
Core macroeconomic indicators provide context for the GDP reading. Inflation remains contained at 3.40% YoY, down from 4.10% six months ago. Unemployment stands at 6.20%, slightly improved from 6.80% last year. The fiscal deficit narrowed to 3.10% of GDP in Q2 2025, supported by robust tax revenues and controlled spending.
Monetary Policy & Financial Conditions
The central bank’s policy rate has held steady at 5.25% since Q1 2025, reflecting a cautious stance amid inflation moderation. Credit growth slowed to 4.50% YoY, indicating tighter financial conditions compared to 7.80% in early 2024.
Fiscal Policy & Government Budget
Fiscal discipline continues, with government expenditure growth limited to 2.20% YoY. The budget deficit improved from 4.50% of GDP in 2024 to 3.10% currently, aided by higher corporate tax receipts and reduced subsidies.
External Shocks & Geopolitical Risks
Global trade tensions have eased, but risks remain from volatile commodity prices and regional conflicts. SC’s export basket, heavily weighted in commodities, benefits from recent price stabilization but remains vulnerable to external shocks.
Drivers this month
- Export recovery contributed 1.10 pp, reversing a 0.70 pp drag last quarter.
- Investment contraction subtracted 0.40 pp, reflecting cautious business sentiment.
- Government spending steady at 0.80 pp, supporting aggregate demand.
Policy pulse
The central bank’s steady policy rate and contained inflation underpin the growth moderation. The 5.25% interest rate is consistent with a neutral stance, balancing inflation risks and growth support.
Market lens
Immediate reaction: SCR/USD appreciated 0.30%, while 2-year bond yields rose 5 basis points, signaling market confidence in growth stability despite the slowdown.
Looking ahead, SC’s GDP growth trajectory depends on several factors. The baseline forecast anticipates growth stabilizing around 4.50% over the next two quarters, supported by steady consumption and export recovery. However, risks remain asymmetric.
Bullish scenario (30% probability)
- Stronger-than-expected export demand lifts growth above 6%.
- Investment rebounds as business confidence improves.
- Fiscal stimulus accelerates infrastructure projects.
Base scenario (50% probability)
- Growth holds steady near 4.50%, with balanced contributions from consumption and exports.
- Monetary policy remains neutral, inflation stable.
- Global conditions remain manageable without major shocks.
Bearish scenario (20% probability)
- Geopolitical tensions disrupt trade, dragging growth below 3%.
- Investment contracts further amid tightening credit conditions.
- Fiscal consolidation pressures domestic demand.
Structural & Long-Run Trends
SC’s economy is gradually diversifying away from commodity dependence, with growing services and manufacturing sectors. This structural shift supports more sustainable growth but requires continued investment in skills and infrastructure.
The September 2025 GDP Growth Rate YoY for SC at 4.60% signals a moderation from earlier rebounds but remains robust relative to historical lows. The interplay of stable fiscal policy, cautious monetary stance, and easing external shocks creates a balanced macroeconomic environment. Financial markets’ muted but positive reaction reflects confidence tempered by uncertainty. Forward-looking risks include geopolitical tensions and investment volatility, while opportunities lie in export recovery and structural reforms.
Key Markets Likely to React to GDP Growth Rate YoY
The GDP growth rate is a critical barometer for SC’s economic health and influences several tradable markets. The SCR/USD forex pair typically reacts to growth surprises, reflecting currency strength or weakness. The local equity index SCIDX tracks corporate earnings tied to economic expansion. Government bonds such as SCGB10 respond to growth and inflation expectations. The commodity-linked ETF COMET correlates with export performance. Finally, the cryptocurrency SCBTC shows sensitivity to risk sentiment shifts tied to macro data.
Indicator vs. SCIDX Since 2020
Since 2020, SC’s GDP growth rate and the SCIDX equity index have exhibited a strong positive correlation (r=0.72). Periods of GDP contraction, such as late 2023, coincided with sharp equity declines, while rebounds in 2025 aligned with index rallies. This relationship underscores the equity market’s sensitivity to economic fundamentals and growth expectations.
FAQs
- What does the latest SC GDP Growth Rate YoY indicate?
- The 4.60% growth rate signals a moderation from earlier peaks but confirms ongoing economic recovery and resilience.
- How does monetary policy affect SC’s GDP growth?
- Monetary policy at a neutral 5.25% supports controlled inflation while allowing moderate growth, balancing risks.
- What are the main risks to SC’s growth outlook?
- Geopolitical tensions, investment softness, and global commodity price volatility pose downside risks to growth.
Key takeaway: SC’s GDP growth is stabilizing after a volatile recovery, with balanced risks and opportunities shaping the near-term outlook.
This has been drafted with AI assistance and then thoroughly reviewed, refined, and approved by our human editorial team to ensure accuracy, and originality.
Key Markets Likely to React to GDP Growth Rate YoY
The GDP growth rate influences multiple asset classes in SC’s financial ecosystem. The SCRUSD currency pair reflects economic strength and monetary policy shifts. The local stock index SCIDX tracks corporate earnings tied to GDP trends. Government bonds like SCGB10 respond to inflation and growth outlooks. The commodity ETF COMET correlates with export performance. Lastly, the cryptocurrency SCBTC is sensitive to risk sentiment shifts linked to macro data.
Sources
- Sigmanomics database, GDP Growth Rate YoY for SC, September 2025 release.
- Central Bank of SC, Monetary Policy Report Q3 2025.
- Ministry of Finance SC, Fiscal Budget Update Q2 2025.
- International Trade and Commodity Price Reports, August 2025.
- SC Financial Markets Data, September 2025.
The current GDP growth rate of 4.60% contrasts with the previous quarter’s 10.10% and the 12-month average of 3.50%. This reflects a significant moderation from the post-pandemic rebound peak but remains above the long-term trend.
Comparing historical data from the Sigmanomics database, the 4.60% growth is the lowest since the 1.50% recorded in September 2024 but well above the negative troughs of -12% in December 2023 and -5.80% in June 2024.