Heading into Monday EU session and the release of July macro data, we have noted the industrial sector and business cycle indicators printing below consensus figures (negative surprise)
The U.K. economic slowdown has not been reflected in personal/household, retail sector, and the labour market. Employment has recently slowdown its pace, but the economy keeps adding jobs, while the jobless rate remains at low levels
However, July data showed industrial production contracted by 0.3% M/m, manufacturing expanded by 0.1% M/m vs est. +0.3%, construction output fell 0.8% M/m vs est. +0.5%. The U.K. 3-Mo GDP Growth came in flat as the consensus expected a rise of 0.10%, while the July print showed an expansion of 0.20% vs. est. 0.40%
On a side note, the housing and real estate sector is surprising to the upside by the most. The sector strength could be feeding into monetary conditions, as these remain the most tight relative to both EU and the U.S. indexes. This won't be an easy job for the BoE.
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