Excel Currencies Blog

Lack of Premier League football in December bizarrely affects UK GDP..

Three headlines in which to discuss for the week-end then and let's start with the first. We had a feeling at the beginning of the week £ could recover after a bit of a traumatic week last time out. The lack of economic data has meant a road of recovery for GBP with 1-2% being clawed back in the last few days.

Yesterday, we saw a few MPC members giving evidence before Parliament's Treasury Select Committee (TSC). Governor Bailey confirmed again his belief that inflation has indeed turned a corner, however, he did add that he would like to see more evidence. The Bank's Chief Economist Huw Pill added to the notion saying "there is no room for complacency", but it was policymaker Jonathan Haskel that stole the limelight with his hawkish comments.

"Economic theory suggests that uncertainty around the persistence of inflation should be met with more forceful action, and so i shall remain alert to indications that inflation is more persistent that we expected, and act forcefully if necessary". The use of term indicates another sizeable interest rate hike is incoming..

As you would have probably read in the headlines earlier today, the ONS confirmed that the UK narrowly evaded recession in Q4 last year. -0.5% was worse than forecast (-0.3%) but it meant with a 0% growth figure overall for the quarter, the economy avoids a technical recession for now. The services sector weighed heavily on the number with the recreation/entertainment category down almost 8%. The main factor of this was the lack of Premier League football due to the World Cup..