RBNZ To Keep Rates On Hold, UK GDP Expected To Slow In Q4 2018

The UK will be releasing its advance quarterly GDP report for the fourth quarter of 2018. Manufacturing, industrial and construction output reports will come out as well. The data will be key as it will provide further insights into how the UK economy fared as it heads closer to the Brexit deadline.

Japan will also be releasing its preliminary GDP report for the fourth quarter of 2018. Japan’s GDP contracted 0.6% in the third quarter of the year, but economic activity should expand in the fourth quarter of the year.

The Eurozone’s GDP estimates are on the tap this week. GDP should show a 0.2% increase during the quarter ending December.

Data from the United States this week will see the producer prices index data coming out followed by the retail sales report.

Here’s a quick recap of what’s to come in the currency markets this week.

UK fourth-quarter GDP forecast to slow

Data from the U.S. will see the advance GDP report for the fourth quarter of 2018 coming out. According to initial estimates, the fourth quarter economy should increase by 2.6% in the three months ending December 2018. On a quarterly basis, the GDP should advance just 0.3% marking a decline from the 0.6% growth registered in the third quarter.

This marks a relative slowdown compared to a 3.4% increase in the third quarter of the year. The fourth quarter GDP will mark a second consecutive quarterly decline in the pace of economic expansion.

Besides the GDP figures, the retail sales numbers will be coming out over the week followed by the monthly durable goods orders report. Retail sales might increase by 0.1% on the month in December.

The Institute of Supply Management’s non-manufacturing PMI will also be coming out this week. In December, the non-manufacturing PMI fell to 57.6 on the index, following an increase to 60.7 in November.

RBNZ expected to leave interest rates unchanged

The Reserve Bank of New Zealand will be holding its monetary policy meeting this week. The central bank might leave the official cash rate unchanged at 1.75%. The wait and watch mode from the RBNZ is likely to continue as policymakers wait and assess more economic data.

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