Market themes of the Day: UK GDP and the manufacturing output headline

Mario Blascak, PhD Independent Analyst

What you need to know before markets open
Main themes:

The Canadian employment rose 66.8K in January with the unemployment rate ticking up to 5.8%. USD/CAD fell some 50 pips on the data with strong employment saving the day for Loonie. More details are in Yohay’s USD/CAD forecast here.
The EU Brexit negotiator Michel Barnier tweeted that he is looking forward to meeting UK's Brexit Minister Barclay on Monday and listen to suggestions of how to proceed on as the EU is not going to re-open the withdrawal agreement but will work on the political agreement.
Several UK Cabinet Ministers warned that a no-deal Brexit may lead to the reunification of the Northern Ireland with the Republic due to “chaos, disruptions, and uncertainty.”
The UK fourth-quarter GDP is expected to slow down rapidly to 0.2% Q/Q as Brexit uncertainty is taking its toll. For details read my UK GDP Preview here.

Europe

The German trade balance reached a surplus of €19.4 billion in December, up about €1 billion from what was expected.
The Eurogroup is meeting today with the ECB President Mario Draghi set to participate.

The UK Prime Minister Theresa May rejects compromise on the issue of Irish border backstop.
The EU Brexit negotiator Michel Barnier tweeted that he is looking forward to meeting UK's Brexit Minister Barclay on Monday and listen to suggestions of how to proceed on as the EU is not going to re-open the withdrawal agreement but will work on the political agreement.
Several UK Cabinet Ministers warned that a no-deal Brexit may lead to the reunification of the Northern Ireland with the Republic due to “chaos, disruptions, and uncertainty.”
The UK fourth-quarter GDP is expected to slow down rapidly to 0.2% Q/Q as Brexit uncertainty is taking its toll. For details read my UK GDP Preview here.
The UK manufacturing output is expected to increase 0.1% over the month in December while contracting -0.7% over the year.

Canada

Canada’s employment rose strong 66.8K in January with the unemployment rate ticking up to 5.8%. USD/CAD fell some 50 pips on the data with strong employment saving the day for Loonie. More details are in Yohay’s USD/CAD forecast here.
Canada’s international trade balance is expected to reach a deficit of -C$2.06 billion.

The US talks collapsed on a border deal with the second US government shutdown looming this year.
The US-China trade talks are expected to resolve the intellectual property issues this week.

Author

Mario Blascak, PhD

Independent Analyst

Dr. Mário Bla&scaron;čák worked in professional finance and banking for 15 years before moving to journalism. While working for Austrian and German banks, he specialized in covering markets and macroeconomics.

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