UK: Softer than expected data - TDS

Analysts at TDS explain that this morning's UK data for April was softer than expected across the board: manufacturing production fell -1.4% m/m (mkt +0.3%), construction output was up 0.5% (mkt +2.0%), and the visible trade balance deteriorated to -£14.0bn (mkt -£11.3bn), with details showing a small 0.5% gain in import volumes but a much larger -6.1% drop in export volumes.

Key Quotes

“We already flagged the risk that the UK data starts the week on a soft note, but do look for it to pick up to end the week with a solid retail sales report, although this is admittedly an even softer start than we had anticipated. We do think though that a strong retail number should be the bigger factor at the end of the week in helping to convince markets that a rate hike in August is still in the cards for the BoE.”