EconoTicker

• Rightmove House Price Index (MoM, Sep): +0.4% (vs. -1.3% prior)
• Rightmove House Price Index (YoY, Sep): -0.1% (vs. +0.3% prior)

Market impact: Slightly supportive for GBP, as the monthly rebound suggests some resilience in the housing market. However, the annual decline signals ongoing weakness in property demand.

Historical context: This is the first monthly increase since May, but house prices remain below year-ago levels, reflecting higher borrowing costs and affordability pressures.

• NIESR Monthly GDP Tracker (Aug): +0.3%, above July’s +0.2%, suggesting modest economic expansion.

Market impact: Slightly positive for GBP, as the data supports a view of steady but fragile growth momentum.

Historical context: The NIESR tracker has remained positive for three consecutive months, contrasting with July’s official flat GDP print and pointing to underlying resilience.

• Inflation Expectations: 3.6%, up from 3.2% previously, showing households foresee stickier price pressures ahead.

Market impact: Slightly positive for GBP, as higher expectations may reinforce the BoE’s cautious stance on rate cuts.

Historical context: Expectations remain well above the BoE’s 2% target, highlighting lingering concern over cost-of-living pressures despite easing headline inflation.

• Trade Balance (Jul): -£22.24B, marginally larger than June’s -£22.16B and above forecasts (-£21.60B), highlighting persistent external imbalances.
• Trade Balance Non-EU (Jul): -£10.16B, narrowing from -£10.78B in June, reflecting firmer trade outside the EU.

Market impact: Negative for GBP, as the overall deficit remains elevated, weighing on the UK’s external position.

Historical context: The UK’s trade deficit has hovered near £20–22B per month through 2024–25, far above pre-Brexit norms, underscoring structural challenges in trade competitiveness.

• Index of Services (3M/3M): +0.4%, above forecasts (+0.3%) and steady vs. June, showing continued service-sector strength.
• Industrial Production (MoM, Jul): -0.9%, below expectations (0.0%) and reversing June’s +0.7%.
• Industrial Production (YoY, Jul): +0.1%, weaker than forecasts (+1.1%) and just above June’s +0.2%.
• Manufacturing Production (MoM, Jul): -1.3%, missing expectations (+0.1%) after June’s +0.5%.
• Manufacturing Production (YoY, Jul): +0.2%, well below expectations (+1.6%), nearly flat on an annual basis.

Market impact: Mixed for GBP — services strength supports resilience, but weak industrial and manufacturing data highlight headwinds in the goods sector.

Historical context: The services sector continues to underpin UK growth, while manufacturing remains stuck in a low-growth cycle, consistent with broader Eurozone weakness.

• GDP (MoM, Jul): 0.0%, matching forecasts, but weaker than June’s +0.4%, showing flat monthly activity.
• GDP (YoY, Jul): +1.4%, in line with expectations and unchanged from June, signaling stable annual growth.
• GDP 3M/3M (Jul): +0.2%, matching forecasts but slightly softer than June’s +0.3%.

Market impact: Neutral for GBP, as steady annual growth offsets the disappointment of flat monthly activity.

Historical context: The July stagnation follows a stronger Q2 rebound, suggesting the UK economy is losing momentum heading into late summer.

• Construction Output (YoY, Jul): +2.4%, above expectations (+1.9%) and June’s +1.5%, showing steady growth.
• Construction Output (MoM, Jul): +0.2%, beating forecasts (-0.2%) though softer than June’s +0.3%.

Market impact: Slightly positive for GBP, as construction resilience supports domestic demand outlook.

Historical context: Output growth has remained positive for four straight months, suggesting stabilization after weakness in 2023.

• Thomson Reuters/Ipsos PCSI (Sep): 49.9, down from 50.6 in August, dipping back below the 50 threshold and signaling renewed household caution.

Market impact: Slightly negative for GBP, as weaker sentiment highlights fragile consumer confidence amid persistent cost-of-living pressures.

Historical context: This is the first sub-50 reading since May, breaking a three-month streak of positive sentiment.

BRC Retail Sales Monitor (YoY, Aug): +2.9%, above expectations (+2.0%) and July’s +1.8%, signaling firmer consumer spending.

Market impact: Slightly positive for GBP, as resilient retail activity supports the outlook for household demand despite ongoing cost-of-living pressures.

Historical context: August’s reading is the strongest since early 2024, showing gradual stabilization in the retail sector after last year’s slump.

The UK average mortgage rate (Aug) came in at 6.86%, down from 6.95% in July, marking a modest decline in borrowing costs for households.

Market impact: Neutral-to-positive for GBP housing sentiment — while rates remain historically high, the slight easing provides some relief to borrowers.

Historical context: The 6.86% rate is just below the 12-month average (~6.9%) but still near multi-decade highs, highlighting continued affordability pressures in the housing market.

• Halifax House Price Index (YoY, Aug): +2.2%, above forecasts (+2.0%) but slightly lower than July (+2.5%), showing steady annual growth.
• Halifax House Price Index (MoM, Aug): +0.3%, topping expectations (+0.2%) but easing from July’s +0.4%.

Market impact: Neutral-to-positive for GBP and UK housing sentiment, as resilient prices suggest demand is holding despite high mortgage rates.

Historical context: The +2.2% YoY growth is above the 12-month average (~+1.5%), highlighting continued stability in the housing market even as borrowing costs remain elevated.

• Retail Sales (MoM, Jul): +0.6%, stronger than forecasts (+0.3%) and June (+0.3%).
• Retail Sales (YoY, Jul): +1.1%, slightly below estimates (+1.3%) but higher than June (+0.9%).
• Core Retail Sales (MoM, Jul): +0.5%, above forecasts (+0.4%) though below June’s +0.6%.
• Core Retail Sales (YoY, Jul): +1.3%, in line with expectations and unchanged from June.

Market impact: Positive for GBP, as stronger-than-expected monthly growth highlights resilient consumer demand despite high borrowing costs.

Historical context: The +0.6% monthly gain is the strongest in 7 months and above the 12-month average (~+0.2%), suggesting UK consumers remain more active than expected in Q3.