it’s here Michael Hewson, chief market analyst CMC Markets UK, As for UK GDP data due in about 10 minutes…
This morning we got the latest November GDP numbers for the UK economy. This is expected to indicate that the UK economy is already in a mild recession. As the economy contracted in Q3, it is very likely that it will contract further in Q4.
Monthly GDP rose 0.5% in October, but the economy contracted -0.3% for the third month in a row. This rolling three-month number is expected to remain unchanged at this morning’s November number, another number is -0.3%, while the monthly number is expected to decrease by -0.2%.
All sectors of the economy are expected to contract in November, with manufacturing and industrial production expected to slow by -0.2%, construction output by -0.3% and the service index by -0.1%.
This is probably why the pound has underperformed recently. That’s because markets feel the Bank of England doesn’t have much room to raise rates given how fragile the UK economy looks, both at the Federal Reserve and at the European Central Bank. It is considered that there is room to spare.
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With a recession looming, we are trying to find out how well or how badly the UK economy did in November.
The National Bureau of Statistics will release its monthly GDP forecast for November at 7am. Economists expect the UK economy to contract by about 0.2% in November after growing by 0.5%, better than he expected in October.
A fall in GDP in November doesn’t officially put the UK in a technological recession (defined as two quarters of contraction in a row), but it could indicate that one is near.
UK GDP fell by 0.3% in Q3 2022, so a contraction in the October-December quarter would mean a recession (Q4 data available within a month).
Consumer spending weakened as high energy prices hit the economy and the cost of living crisis reduced consumer spending.
Alvin Tan of red blood cell capital market Told the client:
We expect GDP to contract again in November.
Retail sales provided a good guide to recent activity patterns, falling 0.4% month-on-month in November.
investment bank analyst Nomura It also forecast a month-on-month contraction in November, stating:
“Given the worsening survey results and rising inflation, we believe GDP will fall, and we project a 0.3% mama decline in November.”
UK homebuilders warned this week that demand had slowed last fall due to the turmoil following the mini-budget.
7am GMT: UK GDP Report for November
7am GMT: UK Trade Report for November
9am GMT: Germany Annual GDP Growth Report
10am GMT: Eurozone trade balance in November
3:00 p.m. GMT: University of Michigan U.S. Consumer Sentiment Index