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The calendar for today: Trump and UK data

All ears on what Donald Trump has to say in his speech that is to start at 7pm GMT, but let’s see what’s ahead on the data front.

Is the UK enjoying the the same sort of production rebound as the Eurozone? Today we will get both the trade balance and output of the UK. Later during the day there will also be a release of NIESR GDP estiamte for the British economy, but this is basically it when it comes to calendar highlights from the major developed economies.

The British data package comes at 9:30 am GMT and will consist of:

  • Visible trade balance for November - these numbers have been very volatile throughout 2016 and market expectations provide little guidance to what may pop out this time. The EU vs. non-EU breakdown may be important here as the UK is heading for the official start of the Brexit process.
  • industrial production: a MoM rebound of 1% is expected after an unexpected 1.3% drop a month earlier. This would restore YoY growth above zero, from -1.1% to 0.7%. A narrower measure - manufacturing output may have more meaning to the markets, but also here the previous release caught markets by surprise with a negative YoY reading. 

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UK industrial output (red) failed to meet market expectations in the last three prints and the deviation was particularly large in October - is this where the paths of the UK and the EU (with nice rebound in output) separate?; source: Bloomberg

  • construction output - expected to accelerate from 0.7% YoY to 2% (a 0.2% MoM would be sufficient to achieve this). Contrary to the industrial sector, construction has been running more smoothly since the referendum than the market expected.

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 November was a bit softer when it comes to the dynamics of business sentiment in manufacturing and construction sectors, and the figures coming today could reflect this; source: Macrobond, XTB Research

 

Apart from that the indicative five day period has started during which China is to show the new yuan bank loans and broader financing measures for December which may prove important for the global sentiment as the markets seem to have assumed that if the start of the year was ok for China (when it comes t Dec PMIs, the behavior of CNY) then there is nothing to worry.

 

The cable is already depressed so far this year but a second big negative surprise in output numbers could put it under more downward pressure.

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GBP’s weak start of the year; source: xStation5

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