Growth for UK GDP and services
6 April, 2017
Wednesday was all about Markit services data from the UK, US and the EU, with GBP-EUR and GBP-USD gaining half a cent throughout the days trading, following improvement in the UK figures up from 53.3 to 55 and a decline from the US and EU numbers. It was also announced that although UK GDP as a whole increased by 0.7%, perhaps surprisingly, Scottish GDP contracted by 0.2%.
In the evening, the FOMC minutes were released showing that policymakers are expected to start the process of reducing the central bank’s balance sheet later this year but only if the economy stays on course, indicating more confidence in the country’s overall recovery.
Meanwhile, during her 3 day visit to the middle east, with Parliament in recess, PM Theresa May has indicated a willingness to accept that a trade deal with the EU won’t happen until the UK has actually left the bloc, whilst also conceding a possible extension in free movement, making budget payments to the EU and even accepting European court jurisdiction; all of which will occur AFTER 2019 during the “transitional phase”, used by businesses and governments after the UK has made its exit. Whether or not the EU is paid the demanded sum of a €60bn exit bill from Britain remains to be seen.
Today’s focus will be on the ECB and Donald Trump’s meeting in China with Xi Jinping along with employment data from the US at 12:30 pm. The ECB monetary policy meeting accounts are at 12:30 pm which will reflect and give the rationale behind policy decisions. ECB chief Mario Draghi gave a speech at 08:00, which although outside of trading hours in the UK, may cause plenty of rate movements from the other European markets. Elsewhere, first thing this morning Swiss inflation came in up 0.6% rather than the expected 0.5%.
Friday is an exceptionally busy day with trade data from Germany and the UK, manufacturing and industrial production figures, also from the UK, as well as various employment and payroll stats from the US and Canada, set to round the week off, with inevitable surprises so stay in touch with your CI account manager.
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