After a pretty disappointing week for UK economic data, sterling came under pressure and slipped to an eight-year low against the euro at one point. The GDP numbers did enable the pound to regain some losses, but the UK is still showing the slowest growth of all the G7 economies.
The CBI realised sales index dropping to -10 was particularly noteworthy and could signal that UK high streets have some tough times ahead. In addition, the continued decline in sterling’s value could lead to inflation pushing higher again.
Looking to the week ahead, the key figure will be the manufacturing numbers on Friday. It is hoped that the pound’s decline will have resulted in further orders within the sector, but this will not necessarily materialise. Finally, we have another take on house prices from Nationwide on Tuesday and the borrowing numbers on Wednesday.