But the data will fail to capture the post-election sentiment
With the UK election out of the way now and the fact that we are now seeing a huge Conservative majority in parliament, perhaps we can see some Brexit progress and that should help with business/economic sentiment and foreign investments.
As such, UK economic data may take on some importance again from now onwards but don't expect next week's data slew to reflect anything new just yet.
The data is very much lagging and may be affected by the same old Brexit dumbbells so there is that to consider but let's take a closer look:
Monday, 16 December
- UK December flash manufacturing, services, composite PMI
Historically, the survey period is conducted for a week before the data is released but I'm not quite sure if the the release here will survey companies up until today or up until Wednesday. I would assume it is the latter since it's weird to interrupt the election voting day and results day so the readings here should reflect somewhat subdued sentiment seen back in November.
Tuesday, 17 December
- UK October average weekly earnings
- UK October unemployment rate
Wages data have not been heavily impacted and over the course of the year, has been turning up hot. Expectation is for wage pressures to cool off a bit in October but this really isn't an area all too affected by Brexit in a more direct manner.
Wednesday, 18 December
- UK November CPI data
- UK November PPI data
Inflationary pressures have been tracking slightly lower in recent months but the core reading has been more steady. Expectation this time around is for some slight softness but it'll be more interesting to see how the pound's post-election gains translates to price pressures from the December reading onwards.
If anything, this could be one area that could help tilt the BOE into cutting rates in order to prevent a drop-off in inflation expectations.
Thursday, 19 December
- UK November retail sales data
- BOE monetary policy meeting decision
Consumption activity is expected to improve somewhat in November but we'll have to see whether or not the election results can help to boost consumer sentiment in a meaningful manner more so in the next few months instead. As such, we're not going to be able to tie the data here to any post-election improvement so it may be a non-factor for now still.It'll be interesting to see the BOE's take in all of this now that their smooth Brexit scenario looks to be playing out. I wouldn't expect massive tweaks to their language but just keep an eye for any changes with regards to their risk outlook.
Friday, 20 December
- UK Q3 final GDP report
The GDP reports will be the most relevant ones to watch for any changes in economic sentiment after the election - particularly business investment - but it won't reflect anything until Q1 next year so there is a long wait to go before the data becomes more relevant. Anyway, this is the final report release so it should be largely inconsequential.
