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Has the UK Escaped Recession?

Has the UK Escaped Recession?

The FTSE 100 and European stocks finished higher this Wednesday as market sentiment was boosted by Fed chair Powell shrugging off strong labour market figures on Friday.

The rally is also being pushed behind hopes that the UK economy could fare better in 2023 than feared.

The National Institute of Economic and Social Research (NIESR) said the economy will grow marginally despite high prices hitting household budgets.

NIESR has predicted the economy will grow by 0.2% this year, with growth rising to 1% in 2024. The forecast paints a more optimistic picture than others, such as the Bank of England’s.

However, NIESR still warned the rising cost of living would mean for millions, particular in the North East of England and in parts of Scotland, Wales and Northern Ireland, it would feel like a recession.

The optimism is already in the air that the United Kingdom (UK) economy has probably dodged a recession in 2022, which has provided some respite to the Pound Sterling bulls. But will it be enough?

The hotly anticipated numbers are out from the Office for National Statistics at 09.00 GMT+2 on Friday.  They will also be scrutinised in Downing Street and at the Bank of England, as well as by householders across London keen for insight into where interest rates might peak.

Prime Minister Rishi Sunak and Chancellor Jeremy Hunt have said halving inflation is a top priority, although City experts point out that falling energy costs will do much of the work unaided by politicians.

Thursday 9th February UK High Impact Events

The times below are GMT+2

• 11.45 – UK – Monetary Policy Report Hearings

Potential instruments to Trade: GBP Crosses.

Friday 10th February UK High Impact Events

The times below are GMT+2

• 09.00 – UK – GDP m/m

Potential instruments to Trade: GBP Crosses.

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