020 7898 0500On Friday UK manufacturing figures disappointed and as the markets had priced in an increase in activity, the pound weakened. This was the second consecutive decline in the data. It’s yet another sign that the UK economy has lost momentum.
Meanwhile, Bank of England Governor Mark Carney said that the global economy was sitting at a ‘fork in the road’ and that Brexit could be a ‘litmus test’ for the world. Carney emphasised that the UK and the rest of the EU had common interests and that both parties were ‘ideally positioned’ to strike a deal on financial services.
This week is full of tier-one data which may act as a distraction from the ongoing Brexit discussion. Tomorrow we’ll see the latest inflation data: the consumer price index is the central bank’s preferred measure of inflation. The figure is expected to remain above the 2% target but decline slightly to 2.2%.
On Wednesday the UK’s employment data is set for release. The claimant change (number of people claiming unemployment-related benefits) will be closely monitored by the markets and is expected to decline. The key highlight will be the average earnings figure, which represents the three-month moving average compared to the same period last year. This is expected to decline and post a number below inflation which would be a concern to the central bank and government.
On Thursday, the last trading day before the Easter weekend, the quarterly BoE credit conditions survey will be released.
