UK industrial output down 0.5% in May

This morning saw the release of UK industrial and manufacturing production figures; both of these were year on year figures and came in far better than expected despite the monthly figures being negative. UK industrial output fell by 0.5% in May compared with April, raising concerns about its prospects following the EU referendum. Manufacturing accounts for 10 per cent of the UK economy. It is likely to be hit by uncertainty the vote to leave the EU brings to Britain’s trading relationships. Sterling gained back some of yesterday’s losses off the back of these figure

The main event of the week will be non-farm payrolls tomorrow and the pre-cursor to that figure as we know is ADP Employment change of which came up much better coming out as 172k, expected at 160k.
 Whilst ADP employment change is not completely correlative to the NFP’s figure, it gives an indication and signals that maybe May’s job data was a statistical error which is backed up by the fact that yesterday’s ISM non-manufacturing index being the highest point jump since 2008.

FED futures are still pricing February 2019 for the next hike although with a strong non farms tomorrow expect this to be adjusted with a number of traders proposing December this year.

 Latest FX news by William Busby