Yesterday afternoon Cabinet secretary Michael Gove has likened the way that the UK economy has been run to a football team with a star striker, but a midfield that consistently struggles to get the ball upfield and a defence full of holes. "And no forward, not even Lionel Messi, can do it on his own".
Gove’s comments came as Chancellor Jeremy Hunt looks today to defend the government's vision for the UK’s growth strategy today. The current plan will include promoting policies that allow the private sector to re-tool the UK’s industrial base and re-skill the workforce to generate strong growth over the next decade, and low-tax base that will attract foreign and domestic businesses to the UK.
Hunt is also expected to rip up a Brexit ‘red tape’ bill which prevents insurance and pension companies investing in major infrastructure projects which will subsequently unlock a £100bn investment fund.
Forecasters predict that the BOE will increase rates by 0.25% at the meeting on 2nd Feb, however traders are already hedging that rates will come down later this year, which will be positive news to most homeowners.
The U.S. annual GDP final figure for 2022 came in at 2.9% , higher than the expected 2.6%. The positive news still doesn’t cancel out the chance of the U.S falling into recession as recent retail sales have fallen sharply and the manufacturing sector has joined the housing market in contracting.
The dollar strengthened slightly after the GDP numbers however lost ground against the pound after news of Jeremy Hunt's plans. GBPUSD traded back at 1.2330 before rebounding in evening trading to over 1.24. GBPEUR was down at 1.1328 before touching close to 1.14.
GBPUSD currently resides at 1.2375
GBPEUR currently resides at 1.1370
EURUSD currently resides at 1.0881