UK: Focus on industrial production data – RBC CM

Analysts at RBC Capital Markets suggests that even by its own volatile standards, recent industrial production data have been erratic, making it very difficult to predict what will happen in January and as a result will be in focus for today’s UK session.

Key Quotes

“All we can say is that the manufacturing component (around two-thirds of total IP) should make a positive contribution to GDP in Q1 2017 if the survey data are anything to go by. However, for January by itself volatility in the IP data may wrong-foot many tracking Q1 GDP growth, as indeed it did in Q4 2016. Nevertheless, this January IP print will give us the first piece of hard data used as an input into the Q1 2017 GDP growth calculation, so will be closely followed, even though we would caution against reading too much into one month’s data. Our forecast for Q1 GDP growth is 0.4% q/q.”