Britain's economic growth has slowed markedly, according to data on Wednesday that supports expectations the Bank of England will not raise record low interest rates any time soon.
Hurt by slow demand for exports from a flagging global economy, gross domestic product grew 0.4 percent in the third quarter, matching its lowest rate since late 2012, when Britain was still struggling to recover from the financial crisis. This missed forecasts of a 0.5% increase.
Until a couple of months ago, the BoE was expected to raise rates quite soon after the U.S. Federal Reserve, which last week increased borrowing costs for the first time in nearly a decade. However, that was before wage growth slowed in Britain and Wednesday's unexpected growth downgrade and has seen GBP sold off against most currencies towards the end of the year.
A gauge of U.S. business investment plans fell in November and the prior month's increase was revised sharply lower as the drag on manufacturing from a strong dollar and spending cuts in the energy sector showed little sign of slowing.
But the outlook for the economy remains encouraging, with other data on Wednesday showing consumer sentiment at a five-month high in December and personal income rising for an eighth straight month in November. This should support consumer spending and economic growth in the fourth quarter and early in 2016.
USD – 13:30 – Initial Jobless Claims expected to decrease from 271k to 270k