The UK Average Weekly Earnings posted as expected at 2.5%, up from 2.4% in the previous reading. Despite the rise, the figure still runs below inflation. The Unemployment Rate figure missed expectations, posting a bearish 4.4%. This is the first time unemployment has risen within the UK.
The Dollar boosted overnight, as the Fed released the minutes from their latest monetary policy. Despite not raising rates in the January meeting, the minutes indicated they were still on path to continue raising rates this year. The minutes showed the Fed had received a briefing as to why the models used to forecast inflation had been inaccurate. It had failed to include transitory factors, such as a change in mobile phone pricing. The Fed also believe inflation will move up to the 2 percent target, over the ‘medium term.’
UK GDP missed expectations this morning, posting 0.4%, compared to the 0.5% forecasted, putting the year on year reading for 2017 as 1.4%. The downwards revision was caused by small revisions to mining, energy generation and services. The bearish reading makes the UK the slowest growing major economy in 2017 and positions the country at the bottom of the G7 growth table. The Pound took a tumble as the disappointing figure provides less evidence for the Bank of England to raise rates again in May.
The European Central Bank will release their Monetary Policy meeting accounts today. It is unlikely that the minutes will reveal much, as the ECB left their policy unchanged in the latest meeting. However, the markets will be looking at whether the ECB are focusing on the strong economic growth or the low inflations levels. Across the pond, the first set of FOMC members are scheduled to speak, with more to follow tomorrow. FOMC member Raphael Bostic will be speaking at the Banking Outlook Conference, hosted by the Federal Reserve Bank of Atlanta. William Dudley will be speaking about the economic situations in the areas affected by the Hurricanes in September.