forecasting freightcast

Markets Up, Economy Mixed

FTR Analysts | September 23, 2025

3:24

It’s been a strong start to September on Wall Street, but the bigger economic picture is less clear. Consumers are still spending, the Fed has shifted gears with its first rate cut in nine months, and industrial production is holding up. At the same time, housing continues to struggle and manufacturing gains are narrowly focused. Here’s where things stand.

Markets Keep Climbing

stock market September is usually a tough month for stocks, but not this year. All three major indexes closed at record highs on Friday, with the Nasdaq leading the way.

Dow Jones: 46,315 (+0.37%)
S&P 500: 6,664 (+0.49%)
Nasdaq: 22,631 (+0.72%)

Even better, each index logged gains for the week: Dow (+1.05%), S&P (+1.2%), and Nasdaq (+2.2%). A standout was FedEx, up 2.3% after beating earnings expectations.

Manufacturing: Not All That Glitters

shutterstock_keyrecovery Industrial production edged up 0.1% in August and manufacturing rose 0.2%. That sounds encouraging, but the strength is concentrated in a handful of industries.

Doing well: Computers, electronics, chemicals, aerospace, and petroleum
Showing momentum: Autos and parts — output has climbed for nine straight months
Big picture: Manufacturing overall is still less than 1% higher than a year ago

Tariffs remain a drag, and with the issue headed to the Supreme Court, there’s little clarity for manufacturers.

Consumers: Spending, But Mostly Paying More

Retail sales were up 0.6% in August, but higher prices explain a lot of that increase. Adjusted for inflation, sales were only up 0.2%.

Online shopping was strong (+2%), extending its winning streak to 11 out of the past 12 months.
Auto sales ticked up another 0.5%, partly because buyers want to get ahead of tariffs.
Consumer goods prices rose 0.5% in August, which means people spent more but didn’t necessarily get more.

Consumers remain resilient, but with job growth slowing, spending could start to cool.

Free Webinar!

The economy is volatile, tariffs are shifting, and capacity remains uncertain—leaving food shippers and carriers asking: How do we prepare for 2026? Join us for a FREE webinar on October 2 hosted by FTR and Food Shippers of America that will cut through the noise and deliver clarity on freight demand, driver supply, and the 2026 outlook for trucks and trailers. Don’t miss it!

Fed: First Cut in Nine Months

The Federal Reserve lowered rates by 25 basis points, bringing the federal funds rate down to 4.0%–4.25%. It’s the first cut in nearly a year and signals the Fed is shifting focus toward supporting the labor market.

2025: Two more cuts expected, ending near 3.625%
2026: One additional cut to 3.375%
Long-term “neutral” rate: ~3.0–3.25%

The message is clear: the Fed sees job risks outweighing inflation risks for now.

Housing: Still the Weak Spot

home with a for sale in front of it-1 Housing continues to look weak, and August’s data didn’t help:

Housing starts fell 8.5% to 1.307M (SAAR)
Single-family starts dropped 7%
Multi-family starts plunged 11.7%, the lowest since 2021
Building permits fell 3.7% — the fifth monthly drop in a row

Lower mortgage rates (6.26%, an 11-month low) could help, but affordability remains a major barrier.

What’s Coming This Week

We’ll get a fresh look at several key indicators:

Home sales: Both new and existing sales likely moved lower in August
Durable goods orders: Expected +0.6%, but weaker if you strip out transportation
Consumer spending & inflation: Real spending projected +0.2%; inflation +0.3%

The Bottom Line

Markets are riding high, but the economy underneath is more complicated. Manufacturing is narrow, housing is weak, and consumer spending is increasingly driven by prices. The Fed’s rate cut is a clear sign that job market concerns are front and center.

At FTR, we understand how challenging it is to make confident decisions when markets are being pulled in different directions by tariffs, inflation, and shifting Fed policy. Our Freight•cast methodology is designed to cut through the noise, turning complex data into clear, actionable intelligence. Whether it’s understanding how housing trends affect freight demand, or how policy changes ripple through supply chains, FTR equips companies with the insights they need to plan strategically instead of reacting to uncertainty.

In uncertain times, trusted intelligence makes all the difference—and that’s where FTR helps you stay ahead. Click here to learn more.

Join industry leaders on November 4, 2025, in Houston for the FTR State of Freight: Chemicals & Petroleum Symposium—a one-day, deep-dive into how shifting trade, equipment markets, and economic forces are reshaping freight. Designed for shippers, carriers, and procurement professionals, this small-group forum blends expert forecasts with candid discussion to help you make smarter investment decisions.

Gain expert insights into tank car and covered hopper demand, leasing, and investment strategies at the 2025 RFC & FTR Chemical Cars & Capital Forum on November 5 in Houston. This one-day event brings together rail equipment managers, investors, and market analysts for data-driven forecasts and high-value networking.