Black Friday is Now! Don’t miss out on up to 60% OFF InvestingProCLAIM SALE

Week Ahead Economic Preview: UK Budget And Brexit

Published 19/11/2017, 13:00

The week sees flash PMI data releases plus the UK’s Autumn Budget and ongoing Brexit discussions.

The main data releases include flash PMI survey data for the US, eurozone and Japan, providing insights into economic health mid-way through the fourth quarter (a free-to-read full round-up of October’s PMI results is available here).

US PMI and FOMC minutes to guide Fed policy

October PMI data had shown the US economy reviving after hurricane-related disruptions in prior months, with growth accelerating in manufacturing and remaining strong in services. Cost pressures cooled, however, as supply chain disruptions eased. The November readings will provide a clearer picture of the health of the US economy in terms of underlying output growth, employment and inflationary pressures.

Strong PMI readings will help guide expectations as to when the Fed could hike interest rates again, as will the publication of the FOMC minutes. The FOMC has previously indicated that it is actively mulling a December rate hike but markets currently assign less than a 10% probability to such a hike.

Other notable US economic data releases include October durable goods orders, consumer sentiment and existing home sales.

Has the euro-boom persisted into Q4?

In Europe, the surprising strength of the eurozone PMI data has been gradually confirmed by official data, and flash November PMI numbers will provide a reliable guide to whether the recent growth surge has persisted into the fourth quarter. The October PMI reading pointed to another quarter of 0.6-0.7% growth.

UK Budget and Brexit

The UK Chancellor of the Exchequer delivers the Autumn Budget the day after government borrowing numbers for October are published. The Chancellor has come under increasing pressure to deliver a popular ‘big and bold’ budget that includes increased spending as a means of reviving spirits in the struggling and divided government.

Brexit will no doubt meanwhile continue to provide a near-constant news flow of chatter and speculation in Europe. The week sees EU leaders convene to assess the progress made with the UK’s divorce negotiations and prepare the ground for December’s crucial summit. The UK waits to see if Brussels deems enough progress has been made on the terms of the divorce to allow discussions to move on to the all-important future trade relationship. The size of the divorce bill remains a key sticking point.

The ONS will also have another stab at estimating third quarter GDP, with no signs that the current estimate of 0.4% will be revised.

Disclaimer: The intellectual property rights to these data provided herein are owned by or licensed to Markit Economics Limited. Any unauthorised use, including but not limited to copying, distributing, transmitting or otherwise of any data appearing is not permitted without Markit’s prior consent. Markit shall not have any liability, duty or obligation for or relating to the content or information (“data”) contained herein, any errors, inaccuracies, omissions or delays in the data, or for any actions taken in reliance thereon.

In no event shall Markit be liable for any special, incidental, or consequential damages, arising out of the use of the data. Purchasing Managers' Index™ and PMI™ are either registered trademarks of Markit Economics Limited or licensed to Markit Economics Limited. Markit is a registered trade mark of Markit Group Limited."

Latest comments

Loading next article…
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.