The economy expanded by 0.5% in the July to September period, according to the Office for National Statistics (ONS). This was slightly better than expected, albeit slightly under the previous quarters reading, which should keep the Bank of England’s pistol in its holster for a little longer when it comes to interest rate cuts. Sterling initially strengthened but then weakened by afternoon as long-term thought and outlook weighed on the currency, given that there is still no clarity on what will happen or how the economy will perform outside of the EU.
On a positive note for the manufacturing sector, Nissan cars confirmed that it will build both the new models Qashqai and the X-Trail SUV at its Sunderland plant thanks to government ‘support and assurances’. Nissan’s decision is the first major development for the car industry since the Brexit vote and secures 7,000 jobs. The government will hope more deals of the same nature can be brokered with overseas manufacturers.
The day is quiet for the final trading session of the week but with end of the month approaching, we could see enhanced volatility in sterling markets.