According to analysts at TD Securities, UK’s November GDP was quite a bit softer than expected at -0.3% MoM (market 0.0%).
Key Quotes
“There were a few analysts (including us) calling for -0.1%, but no one any weaker than that. The decline was led by manufacturing at -1.7% m/m (mkt -0.2%, TD -0.9%), but the important index of services was also much weaker than expected at -0.3% (mkt 0.0%), with fairly widespread declines among sub-sectors. That being said, we don’t think that the November GDP data is likely to be a make-or-break factor for the BoE decision in two weeks.”
“The story for the MPC instead seems to be the split between those who believe that the data will bounce in Jan once the political uncertainty recedes, and those who are sceptical. However, with Vlieghe’s comments over the weekend, it seems that the MPC’s optimistic camp may be starting to lose members to the pessimistic side, and the January decision is certainly a closer call now than what we had previously thought.”
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