"Coming in the leadup to Thursday's BoE rate decision, the weakness seen in today's report should see traders double down on the notion that we will see a 25bp cut from Bailey & co. Notably, the 7.9% public sector wage growth figure stands in stark contrast to the 3.9% seen in the private sector, highlighting the inflationary impact of the government's previous budgetary measures."
"However, there has been some good news in the wake of the Chancellors latest efforts, with a resurgence in business activity in the wake of the budget seeing a composite PMI figure that is consistent with 0.2% GDP growth in December. Nonetheless, she shouldn't celebrate too much, with her pre-budget antics having damaged business activity as a whole range of prospective policy measures were thrown out to the public, forcing many to make investment and personal finance choices that would have ultimately proven unnecessary."
"When looking at the latest UK PMI survey, one concern comes from the fact that the surge in new orders came alongside a sharp rise in input costs and prices charged, as producers passed their rising costs on to the consumer. Things have been less convincing on the other side of the channel, with PMI surveys released throughout mainland Europe losing traction as we head into year-end. Crucially, forecasts of a rise back into expansion territory for eurozone manufacturing didn't come to pass,"
European markets opened weaker after a US session where the tech sector led declines. UK jobs data showed unemployment rising to 5.1%, claimant counts increasing, and average hourly earnings coming in hotter-than-expected. Market pricing now leans toward a 25bp Bank of England rate cut, with public sector wage growth at 7.9% versus 3.9% in the private sector. Post-budget measures spurred a pickup in business activity and a composite PMI consistent with 0.2% December GDP growth, but pre-budget uncertainty damaged investment decisions. Mainland European PMIs lost momentum, with German manufacturing contracting sharply and new orders falling.
Read at London Business News | Londonlovesbusiness.com
Unable to calculate read time
Collection
[
|
...
]