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UK GDP Prints Slightly Below Expectations In a Quarter Likely to be Affected by Omicron

UK GDP Prints Slightly Below Expectations In a Quarter Likely to be Affected by Omicron

Richard Snow, Analyst

Nominal GDP Posts 0.9% in October (MoM)

Nominal GDP figures rose 0.9% in October off a forecast 1%.

UK GDP Prints Slightly Below Expectations In a Quarter Likely to be Affected by Omicron
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UK Real GDP Estimated to Have Grown Just 0.1% in October

Monthly real GDP Grew just 0.1% (MoM) as services sector grew 0.4% as a result of increases in doctor appointments and other human health activities. Services and production output increased while construction contracted 1.8% in October which marks the largest fall since April 2020 during the height of the pandemic.

Figure: UK GDP Index (GDP Figure)

UK GDP Prints Slightly Below Expectations In a Quarter Likely to be Affected by Omicron

Source: Office for National Statistics

As such, the unflattering data is likely to support the Bank of England’s caution when deciding on whether to raise interest rates for the United Kingdom next week. The immediate response in GBP/USD saw a knee-jerk reaction lower, however, the move remains within the daily range.

GBP/USD 1 minute chart

UK GDP Prints Slightly Below Expectations In a Quarter Likely to be Affected by Omicron

Chart prepared by Richard Snow, IG

Major Risk Events for the Week Ahead

Next week presents a blockbuster week for those looking to trade the news. Apart from UK employment and inflation data there is also US retail sales data and Markit manufacturing PMI flash data for December. In addition, between the 15th and 17th of December there will be 5 central bank meetings (last of the year) from major central banks consisting of the US Fed, ECB, BoE, Swiss National Bank and BoJ.

UK GDP Prints Slightly Below Expectations In a Quarter Likely to be Affected by Omicron

Take a look for yourself by visiting DailyFX’s economic calendar

--- Written by Richard Snow for DailyFX.com

Contact and follow Richard on Twitter: @RichardSnowFX

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

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