| Time | Country | Event | Period | Previous value | Forecast | Actual |
|---|
| 07:00 | United Kingdom | Manufacturing Production (YoY) | November | 0.2% | 1.7% | 1.3% |
| 07:00 | United Kingdom | Industrial Production (YoY) | November | -0.5% | 0.7% | -0.1% |
| 07:00 | United Kingdom | GDP m/m | November | -0.3% | 0.2% | 0.3% |
| 07:00 | United Kingdom | GDP, y/y | November | -0.1% | 0.2% | 0.2% |
| 07:45 | France | CPI, y/y | December | 3.5% | 3.7% | 3.7% |
GBP depreciated against most of its major rivals in the European session on Friday as investors digested better-than-expected GDP data out of Britain for November and mounting geopolitical tensions.
The Office for National Statistics (ONS) reported the UK’s economy expanded by 0.3% in November, following a 0.3% contraction in October. Economists had predicted a 0.2% advance.
On the one hand, the modest bounce in growth in November, primarily driven by a 0.4% jump in services output, was not enough to allow markets to rule out the risk of a technical recession in Britain for the second half of 2023. In the third quarter of 2023, the British economy decreased by 0.1%. Traditionally, a recession has been defined as two quarters in a row of GDP shrinkage.
On the other hand, the data did not cause a repricing of markets’ ambitious expectations of the Bank of England’s rate cuts. They continue to see five 25-basis-point rate decreases this year, with the first move coming in May.
Meanwhile, the overall sentiment was dented by worries over the escalation of the conflict in the Middle East, which heightened after the UK and US launched air strikes on Thursday night on Houthi targets in Yemen in response to attacks in the Red Sea.