Juncker acknowledges continental drift and heralds his own Jexit
UK industrial production surprised with a 1.1% increase for December compared with the forecasted 0.1% decline. Manufacturing output rose 2.1% following a 1.4% gain previously. Production overall grew 0.3% for the fourth quarter for which no growth had been forecast.
The trade deficit fell to GBP10.9bn from GBP11.6bn but export performance was still subdued. The NIESR GDP estimate printed at 0.7% for the three months to January, up from a revised 0.6% – the strongest estimate for over 18 months.
The US University of Michigan consumer confidence index fell from 98.5 last month to 95.7 for February. Confidence in the current situation held steady but future expectations were where confidence waned.
Fed Vice Chair Fischer stated that there was significant uncertainty surrounding fiscal and trade policies under the new Trump Administration but that the Fed would concentrate on pursuing maximum employment and 2% inflation.
On Wednesday Fed Chair Yellen’s testimony will be watched very closely for any guidance on fiscal policy, although, given the current climate her comments may be relatively limited.
Italian industrial production mildly outperformed expectations. However, there was no significant market reaction and the Euro drifted lower during the day. Jean-Claude Juncker, President of the European Commission, has warned that Brexit talks may mean EU member states could struggle to remain united and that divisions could deepen.
Data to watch: 7am EUR German January Wholesale Price Index, Month on Month, Year on Year.