020 7898 0500Sterling remained fairly range-bound, although at the lower end of this range against the euro, as there was little economic data released from the UK.
The UK general election continues to gather momentum as political parties continue campaigning and presenting their case. The latest polling figures show the Conservatives on 49% and Labour on 31%. The Liberal Democrats are some way back on 9% and, and with just three weeks to go, the Tories seem to have an insurmountable lead.
The EY ITEM Club – an economic forecasting group that produces quarterly economic UK forecasts – believes the jobless rate will rise from about 4.7% this year to 5.4% in 2018, and 5.8% in 2019. A member and advisor to the EY ITEM Club stated that ‘the UK labour market may be starting to become a victim of its own success. As the proportion of people in work has climbed ever higher, firms may have found it more difficult to fill vacancies, resulting in greater utilisation of the existing workforce and slower jobs growth.’
This week we have a heavy week in terms of economic data. Today, the consumer price index is set for release, which is the preferred measure of inflation. With the BoE raising its inflation forecast last week, we expect inflation to put slightly higher to a reading of 2.5%. On Wednesday the labour data is released, with particular focus on the claimant change and the average earnings. Finally, the retail sales will be released on Thursday – last month there was a 1.8% drop in sales and the market will be keen to see if the UK can buck this trend.
