GBP: UK politics now likely to go quiet until Article 50 is triggered – RBC CM

Adam Cole, Research Analyst at RBC Capital Markets, suggests that yesterday’s stronger than expected labour market data take RBC’s UK economic surprise index to +71, the strongest since last June.

Key Quotes

“With UK politics now likely to go quiet until Article 50 is triggered, the greater downside risk for GBP is that a constant diet of upside data surprises has left markets a little complacent on UK growth and the early Q1 indicators should be watched closely. The December RICS house price balance came in at 24 (consensus unchanged at 30). Although this is the first fall since July, at its current level the index remains consistent with high-single-digit house price inflation.”