UK GDP Rises in November but Market focus on Tuesday's vote.
Good morning everyone,
Overall focus will remain on the House of Commons ahead of next Tuesday’s meaningful vote on Brexit. The government yesterday was reportedly considering backing an amendment to give extra protection for workers, which commentators said was an attempt to gain support from some Labour MPs for the meaningful vote. As noted on Wednesday, the government will now have to outline next steps within three sitting days if it loses the vote.
Away from politics, the UK statistics office released monthly GDP figures this morning. It was a mixed bag of results with Construction and Manufacturing slowing in November, but GDP data rose from 0.1% - 0.2% in November. Initial market reaction was weak but since the release at 9:30am, Sterling exchange rates have begun to recover.
In the US, December CPI inflation is expected to be released and is forecast to show a fall to 1.9% from 2.2%, weighed down by a sharp fall in energy prices. Core CPI inflation is expected to be steady at 2.2%. The minutes of the December Fed meeting, published earlier this week, noted that policymakers could afford to be patient about further policy tightening given muted inflation pressures. USD has weakened overall.