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PLN Weakens Amid Quiet NBP

UK Nov GDP Down Amid Second Lockdown

UK DATA

NOV GDP -2.6% M/M (PREV +0.6%), -8.9% Y/Y (PREV -6.8%)

NOV INDEX OF SERVICES -3.4% M/M; -10.2% Y/Y; PRV +0.5% M/M, MED -5.7%

NOV IND PRODUCTION -0.1% M/M, PRV +1.1%, MED +0.5%

NOV MANUFACTURING +0.7% M/M, PRV +1.6%, MEDIAN +1.0%

NOV CONSTRUCTION +1.9% M/M, PRV +1.5%, MEDIAN +0.8%

The second lockdown in Nov took its toll on the economy with m/m GDP falling by 2.6%, although beating expectations (BBG: -4.6%). The ONS noted that many businesses adjusted to the new working conditions.


Source: ONS - GDP Monthly estimate


Moreover, schools remained open and the mfg and construction sector held up well, leading to a smaller impact on the economy in Nov compared to the first lockdown in spring. Nevertheless, GDP remains 8.5% below Feb's level. Dec would need to record -0.9% to yield a flat Q/Q reading in Q4. The service sector was the main driver of the downturn, falling 3.4% which was led by a sharp decline in accommodation and food services as pubs and restaurants had to close again. IP slipped by 0.1%, while mfg output increased 0.7%. The construction sector outperformed expectations, rising by 1.9% in Nov. The ONS noted that the car sector, housebuilding and infrastructure as well as higher foreign demand are all above pre-pandemic levels.

MNI London Bureau | +44 203-865-3814 | irene.prihoda@marketnews.com