UK economy comes under scrutiny

This morning the Pound’s recent good performance has slipped a little following some slightly lower than expected house price data from Halifax. The data showed that house prices grew month on month by 0.7%, which was better than the previous 0.4%, but not as good as the anticipated 0.9%, and as such the Pound slipped back by around a quarter of a cent against both the Euro and the Dollar. Later this morning, the UK economy will be under further scrutiny with the release of industrial production and manufacturing production figures. Both are expected to show a significant improvement on the previous negative figures, amid continued optimism about the UK’s economic recovery. As we have seen with the housing data though – optimism can cause problems if it is not then realised, so the Pound could be vulnerable if these swings from last month’s negative figures to the expected positive figures does not come to pass. There is also a UK GDP release this afternoon from the National Institute of Economic and Social Research, which while not the official ONS release gives a very clear indication of what we can expect when the next official number does come out. As GDP is such an important indicator of economic position, and significant movements in the Pound’s position can be a direct result of unexpected numbers, this one is well worth keeping an eye on. There are various pieces of data due out in Europe and the US today, although nothing too significant, with the highlights being European services PMI and retail sales this morning, and US mortgage approvals this afternoon. Tomorrow sees both the UK and European central banks give their monthly policy statements, so it will likewise be a busy day. A midst all of this key data it is vital you keep in touch with your CI account manager to be kept informed on exactly what is happening, and of course you can also follow us on Twitter @CurrencyIndex.