We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Bullish
GBP/USD
Bearish
USD/JPY
Bullish
Gold
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Oil - US Crude
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Bitcoin
Mixed
More View more
Real Time News
  • What are a few of the common trading mistakes made by traders? Find out from @WVenketas here: https://t.co/Q3sPmP2rya #tradingstyle https://t.co/osTu59J1se
  • Join @malkudsi 's #webinar at 9:00 AM ET/2:00 PM GMT as he discusses basic concepts in technical analysis. Register here: https://t.co/7XCMLsqXZO https://t.co/CPoCwUDy43
  • Have central banks run out of ammo? And where are central banks heading? Find out from cross-asset class trader, @JohnNetto only on Trading Global Markets Decoded #podcast with @MartinSEssex here: https://t.co/Twr44cZ1GB https://t.co/HprpRueTXH
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 97.86%, while traders in France 40 are at opposite extremes with 75.76%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/PG6QQFO8tv
  • What is market volatility and what does a market event volatility look like? Find out from @PaulRobinsonFX here: https://t.co/vg7w10la3j https://t.co/yKEBSyKbgS
  • RT @globaltimesnews: China-US #tradetalks must be based on equal footing and mutual respect. The deal must be mutually beneficial, said Chi…
  • RT @LiveSquawk: China Offers No Confirmation On US Trade Deal – WSJ https://t.co/hWUwdf4iow
  • Commodities Update: As of 11:00, these are your best and worst performers based on the London trading schedule: Oil - US Crude: 1.28% Silver: 0.26% Gold: 0.13% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/La4HQtV3ur
  • Forex Update: As of 11:00, these are your best and worst performers based on the London trading schedule: 🇬🇧GBP: 1.68% 🇪🇺EUR: 0.48% 🇳🇿NZD: 0.26% 🇨🇦CAD: 0.18% 🇦🇺AUD: 0.11% 🇯🇵JPY: -0.30% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/SoW8VDJZgA
  • Indices Update: As of 11:00, these are your best and worst performers based on the London trading schedule: Germany 30: 1.32% France 40: 1.22% Wall Street: 0.55% US 500: 0.51% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/hXfpb9bT4W
British Pound Bogged Down as UK Industrial Output Slumps

British Pound Bogged Down as UK Industrial Output Slumps

2017-03-10 11:03:00
Oliver Morrison, Analyst
Share:

Talking Points:

  • UK industrial production and manufacturing output contracted in January as expected.
  • Cable is hovering around the 1.21 level.
  • See the DailyFX Economic Calendar and see what live coverage for key event risk impacting FX markets is scheduled for next week on the DailyFX Webinar Calendar.

The UK’s industrial production and manufacturing output contracted in January, as expected, after the broader industrial measure hit a six-year high at the end of last year.

Industrial production, which makes up around 15% of the UK’s economic output, dropped 0.40% in January, according to the Office for National Statistics. That’s the first fall in two months, broadly in line with the market estimate of a 0.50% fall, but widely anticipated after the increases of 2.3% in November and 0.9% in December. The fall in production was driven by a 0.9% drop in manufacturing output, mainly made up of a 13.5% decrease in pharmaceutical output, while energy output rose 1.5% after being hit by the mild weather in December.

Year-on-year overall industrial production rose 3.2%, in line with forecasts, with manufacturing output rising by 2.7% against expectations of 2.9%.

In the coming quarters, the fall in the manufacturing PMI to 54.6 in February from 55.7 in January suggests that the strong growth in manufacturing in Q4 is unlikely to be repeated, with some economists warning that the UK is entering stagflation.

Data released by the ONS this morning also show that the UK deficit in trade in goods and services stood at £2.0 billion in January, unchanged from the month prior, and better than the consensus £3.1 billion. Between the three months to October 2016 and the three months to January 2017 the total trade deficit narrowed by £4.7 billion to £6.4 billion.

Commenting on today’s figures, senior ONS statistician Kate Davies said: “Taking the last three months together, construction and manufacturing both grew strongly, with a considerable narrowing in Britain’s trade deficit. However, both manufacturing and construction were broadly flat on the month, with the trade balance little changed.

“Construction orders fell back a little overall in the second half of 2016, albeit after strong growth in the first half of the year.”

The British Pound continues to feel the weight of fears of economic weakness and Brexit uncertainty. This is exacerbated by a strong Dollar on the back of rate-rise expectations and a Euro gaining strength after ECB President Mario Draghi said there was no longer “a sense of urgency” to take action on monetary policy. Cable is hovering around the 1.21 level, while EURGBP has gained 0.0028 to trade at 0.8721 in the Friday session.

The FTSE, however, is better bid on the back of softer Sterling. It’s up 31.59 to 7,345.80.

Chart: GBPUSD Daily Timeframe (November 2016 – March 2017)

British Pound Bogged Down as UK Industrial Output Slumps

--- Written by Oliver Morrison, Analyst

To contact Oliver, email him at oliver.morrison@ig.com

Don't trade FX but want to learn more? Read the DailyFX Trading Guides

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.