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Business investment in the UK rose more than expected
After a run of dismal numbers throughout December that made it look like the Bank of England would step in with some serious stimulus, the reluctance of almost half of its interest rate setters to cut rates even now gave a boost to the pound last week.
Even so, the cut to 3.75% did go ahead, with unemployment at its highest for over four years and inflation falling to 3.2%. This morning GDP was confirmed at just 0.1% for the third quarter. Moreover, the Office for National Statistics (ONS) revised down its previous growth estimate for Q2 from 0.3% to 0.2%.
However, there was good news too from the ONS this morning. Business investment in the UK rose by 1.5% in Q3, much better than expected and reflecting a rise in corporate spending. It takes annual business investment up to 2.7% compared to a prediction of just 0.7%.
On the commodity markets, gold and silver both hit record highs again this morning, as the markets look for safe havens away from the dollar with interest rate cuts likely in the US early next year.
The US blockade of Venezuelan oil exports is another geo-political risk, so make sure any upcoming transactions are protected against the risks of sudden market movements. Secure a fixed exchange rate now with a forward contract; call your Business Account manager on 020 3918 7255 to get started.
GBP: Sterling approaches Christmas on high
There has been a slow but steady upward trend for sterling against the euro and US dollar over the past week, albeit with some sharp movements along the way. The last of the important data releases of 2025 has now been and gone for a week or two, but we will hear house price data on 31 December.
GBP/USD past year
EUR: Will euro perk up after downbeat week?
Last week was fairly negative for the euro, with losses of around half a percent against the pound and other European currencies. It’s all gone very quiet for data releases, apart from some tidying up with final GDP and inflation numbers. These can surprise the markets, however.
GBP/EUR past year
USD: Dollar licks its wounds
A quiet week for the US dollar may have been some comfort after a month of losses that added up to 2-3% against most major pairs including sterling. We’ve got Durable Goods Orders and a second reading or quarterly GDP coming out tomorrow.
USD/GBP past year
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