17/01/17 - IMF Raises UK's Growth Forecast

GBP

The International Monetary Fund (IMF) has raised its forecast for the UK's economic growth this year, following a better than expected economic performance since the Brexit vote. The IMF says it now expects the UK to grow by 1.5% this year, compared with the 1.1% it was previously forecasting. The Fund said the upgrade was due to “a stronger than expected performance during the latter part of 2016”.
 
The 0.4 percentage point upgrade is the largest upward revision the Fund has made to any of the nations or regions it covers in its latest update.

Last night Bank of England governor Mark Carney warned against the headwinds UK households will face this year. Carney will be keeping a close watch on consumer spending amid signs households are dipping into their savings and amassing debts to keep spending in the face of rising inflation.

EUR

The headline Eurozone trade surplus increased to EUR 25.9bn for November from EUR 22.9bn in November 2015 with exports rising 6% over the year, while imports declined 5%. There was a sharp improvement in both exports and imports for the month with exports advancing 3.2% and imports and exports 1.8%

The Eurozone should also be able to secure additional export growth from the competitive Euro and short-term optimism surrounding growth trends in the US and China, although there will be concerns surrounding the UK position. French exports remained weak with a 2% decline for the first 11 months of 2016, while Italian exports rose slightly by 1.0%.

Key Announcements

09:30 – GBP - UK Consumer Price Index (YoY) Dec expected to increase from 1.2% to 1.4%

11:45 – GBP - Teresa May Brexit Speech

15:00 - USD - US Treasury Secretary Jack Lew Speaks