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| Markets await key US jobs report ahead of Fed rate decision - business live | Markets await key US jobs report ahead of Fed rate decision - business live |
| (35 minutes later) | |
| 10.42am GMT | |
| 10:42 | |
| Dollar hits 7-week high versus yen | |
| The dollar is up as investors await the non-farm payrolls report due at 13.30 UK time. | |
| The expectation is that the report will pave the way for a Fed rate hike at next week’s meeting. Markets are now pricing in an almost 90% chance of a hike. The dollar was up almost half a cent to 115.495 yen, the highest since 20 January. | |
| The dollar index, which tracks the greenback against a basket of six major currencies, was flat at 101.80, but is on track for a fifth straight week of gains, it’s best run in eight months. | |
| Hamish Pepper, currency strategist at Barclays, says the dollar’s strength might not have legs: | |
| In the near term it’s going to be quite tough for there to be further dollar strength, given how well priced the Fed meeting is next week, and also just how much the market has priced for the year now as a whole. | |
| Of course that [pricing] holds some relevance for the labour market report today - it implies that you really need to see quite a significant upside surprise if you’re to see continued dollar strength. | |
| 10.16am GMT | 10.16am GMT |
| 10:16 | 10:16 |
| UK data: What the experts say | UK data: What the experts say |
| Alan Clarke, economist at Scotiabank, says that feeding all the data into the supercomputer, we shouldn’t be too downbeat, with the economy likely to grow at a decent pace in the first quarter of 2017: | Alan Clarke, economist at Scotiabank, says that feeding all the data into the supercomputer, we shouldn’t be too downbeat, with the economy likely to grow at a decent pace in the first quarter of 2017: |
| Don’t be misled by all the negative signs! In summary, these data for January, the first month of Q1, make me confident that Q1 GDP growth can easily record 0.5% quarter on quarter still and possibly even 0.6%. | Don’t be misled by all the negative signs! In summary, these data for January, the first month of Q1, make me confident that Q1 GDP growth can easily record 0.5% quarter on quarter still and possibly even 0.6%. |
| Ruth Gregory, UK economist at Capital Economics, says there are signs the economy is becoming better balanced. | Ruth Gregory, UK economist at Capital Economics, says there are signs the economy is becoming better balanced. |
| She says industrial output and construction are on course to provide a bigger boost for the UK economy in the first quarter of 2017 than in the final quarter of 2016. | She says industrial output and construction are on course to provide a bigger boost for the UK economy in the first quarter of 2017 than in the final quarter of 2016. |
| Of course, these sectors only account for around 20% of the economy ... But they should nonetheless prevent GDP growth from slowing too much in Q1. | Of course, these sectors only account for around 20% of the economy ... But they should nonetheless prevent GDP growth from slowing too much in Q1. |
| Meanwhile, January’s trade figures point to more balanced growth too. All in all then, not only do today’s figures add to the evidence that economic growth has maintained a decent pace at the start of the year but they also suggest that growth is starting to become better balanced. | Meanwhile, January’s trade figures point to more balanced growth too. All in all then, not only do today’s figures add to the evidence that economic growth has maintained a decent pace at the start of the year but they also suggest that growth is starting to become better balanced. |
| 9.56am GMT | 9.56am GMT |
| 09:56 | 09:56 |
| The ONS prefers to look at longer-term data, rather than just a monthly snapshot. | The ONS prefers to look at longer-term data, rather than just a monthly snapshot. |
| Kate Davies, senior statistician, says: | Kate Davies, senior statistician, says: |
| Taking the last three months together, construction and manufacturing both grew strongly, with a considerable narrowing in Britain’s trade deficit. However, both manufacturing and construction were broadly flat on the month with the trade balance little changed. | Taking the last three months together, construction and manufacturing both grew strongly, with a considerable narrowing in Britain’s trade deficit. However, both manufacturing and construction were broadly flat on the month with the trade balance little changed. |
| Construction orders fell back a little overall in second half of 2016, albeit after strong growth in the first half of the year. | Construction orders fell back a little overall in second half of 2016, albeit after strong growth in the first half of the year. |
| 9.43am GMT | 9.43am GMT |
| 09:43 | 09:43 |
| UK manufacturing and construction output shrinks | UK manufacturing and construction output shrinks |
| Just in, a flurry of UK data for January from the Office for National Statistics. | Just in, a flurry of UK data for January from the Office for National Statistics. |
| It provides the first official snapshot of how key parts of the economy were performing at the beginning of 2017. | It provides the first official snapshot of how key parts of the economy were performing at the beginning of 2017. |
| Here’s a snapshot: | Here’s a snapshot: |
| Manufacturing output fell 0.9% (economists forecast a 0.6% drop) | Manufacturing output fell 0.9% (economists forecast a 0.6% drop) |
| Industrial output fell 0.4% (in line with forecasts) | Industrial output fell 0.4% (in line with forecasts) |
| Construction output fell 0.4% (economists expected a 0.2% drop) | Construction output fell 0.4% (economists expected a 0.2% drop) |
| Trade deficit narrowed unexpectedly to £10.8bn | Trade deficit narrowed unexpectedly to £10.8bn |
| Updated | Updated |
| at 9.45am GMT | at 9.45am GMT |
| 9.19am GMT | 9.19am GMT |
| 09:19 | 09:19 |
| BT shares up 4% after Openreach deal | BT shares up 4% after Openreach deal |
| Investors have welcomed BT’s agreement to separate from Openreach, which controls the UK’s broadband infrastructure. | Investors have welcomed BT’s agreement to separate from Openreach, which controls the UK’s broadband infrastructure. |
| BT is top of the FTSE 100 leader board this morning, with shares up 4% at the moment (and higher earlier). | BT is top of the FTSE 100 leader board this morning, with shares up 4% at the moment (and higher earlier). |
| Neil Wilson, senior market analyst at ETX Capital, gives his take on BT’s shares: | Neil Wilson, senior market analyst at ETX Capital, gives his take on BT’s shares: |
| Shares in BT rallied on the open after the company finally reached a settlement to separate its prized Openreach division. It ends a lot of uncertainty over the future of BT and investors cheered the news with the stock gaining 5% in early trading. | Shares in BT rallied on the open after the company finally reached a settlement to separate its prized Openreach division. It ends a lot of uncertainty over the future of BT and investors cheered the news with the stock gaining 5% in early trading. |
| It’s a marked contrast to the dark day in January when the shares plunged by a fifth just in just a few hours on troubles at its Italian division. Today’s gains have so far not seen the stock recover to the level it was trading at before news of the accounting trouble in Italy rocked the group. | It’s a marked contrast to the dark day in January when the shares plunged by a fifth just in just a few hours on troubles at its Italian division. Today’s gains have so far not seen the stock recover to the level it was trading at before news of the accounting trouble in Italy rocked the group. |
| 9.10am GMT | 9.10am GMT |
| 09:10 | 09:10 |
| German imports jump in January | German imports jump in January |
| Earlier we had German trade data, which showed a stronger-than-expected rise in imports in January according to the federal statistics office. | Earlier we had German trade data, which showed a stronger-than-expected rise in imports in January according to the federal statistics office. |
| Imports grew by 3% compared with December, outpacing 2.7% growth in exports which was also a bigger-than-expected rise. | Imports grew by 3% compared with December, outpacing 2.7% growth in exports which was also a bigger-than-expected rise. |
| Germany imported goods worth €84bn in January, and exported goods worth €99bn. | Germany imported goods worth €84bn in January, and exported goods worth €99bn. |
| Economists polled by Reuters had forecast a 0.5% increase in imports and a 1.85% rise in exports. | Economists polled by Reuters had forecast a 0.5% increase in imports and a 1.85% rise in exports. |
| German #exports in January 2017: +11.8% on January 2016 #foreigntrade https://t.co/on1KRpvqWc pic.twitter.com/g7hmjLUbvd | German #exports in January 2017: +11.8% on January 2016 #foreigntrade https://t.co/on1KRpvqWc pic.twitter.com/g7hmjLUbvd |
| 8.53am GMT | 8.53am GMT |
| 08:53 | 08:53 |
| Markets rise ahead of US jobs report | Markets rise ahead of US jobs report |
| Markets have a spring in their step this morning, with European indices following Asian shares higher. | Markets have a spring in their step this morning, with European indices following Asian shares higher. |
| Today’s non-farm payrolls are viewed as the last hurdle to get over before the Fed takes the plunge and raises rates next week. So the report is keenly awaited on both sides of the Atlantic. | Today’s non-farm payrolls are viewed as the last hurdle to get over before the Fed takes the plunge and raises rates next week. So the report is keenly awaited on both sides of the Atlantic. |
| Here are the scores so far this morning: | Here are the scores so far this morning: |
| FTSE 100: +0.4% at 7,343 | FTSE 100: +0.4% at 7,343 |
| Germany’s DAX: +0.4% at 12,024 | Germany’s DAX: +0.4% at 12,024 |
| France’s CAC: +0.3% at 4,996 | France’s CAC: +0.3% at 4,996 |
| Italy’s FTSE MIB: +0.9% at 19,739 | Italy’s FTSE MIB: +0.9% at 19,739 |
| Spain’s IBEX: +0.4% at 10,041 | Spain’s IBEX: +0.4% at 10,041 |
| Europe’s STOXX 600: +0.3% at 374 | Europe’s STOXX 600: +0.3% at 374 |
| 8.43am GMT | 8.43am GMT |
| 08:43 | 08:43 |
| BT reaches agreement to legally split from Openreach | BT reaches agreement to legally split from Openreach |
| In terms of corporate news, BT dominates this morning. | In terms of corporate news, BT dominates this morning. |
| The telecoms giant has finally reached an agreement with Ofcom to legally separate Openreach, which controls the UK’s broadband infrastructure. | The telecoms giant has finally reached an agreement with Ofcom to legally separate Openreach, which controls the UK’s broadband infrastructure. |
| BT has been in dispute with the regulator over the split for about two years. Under the deal Openreach will be stripped of BT branding and become a “distinct company with its own staff and management, together with its own strategy and a legal purpose to serve all of its customers equally”. | BT has been in dispute with the regulator over the split for about two years. Under the deal Openreach will be stripped of BT branding and become a “distinct company with its own staff and management, together with its own strategy and a legal purpose to serve all of its customers equally”. |
| The idea is that an independent Openreach will boost competition in the sector and boost the roll-out of superfast broadband. | The idea is that an independent Openreach will boost competition in the sector and boost the roll-out of superfast broadband. |
| BT’s rivals, including Sky, TalkTalk and Vodafone, have argued that BT has deliberately been slow to open up the network to their engineers, which has hampered their ability to offer homes superfast broadband access. | BT’s rivals, including Sky, TalkTalk and Vodafone, have argued that BT has deliberately been slow to open up the network to their engineers, which has hampered their ability to offer homes superfast broadband access. |
| Here is our full story: | Here is our full story: |
| 8.14am GMT | 8.14am GMT |
| 08:14 | 08:14 |
| The agenda: It's US payrolls day | The agenda: It's US payrolls day |
| Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business. | Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business. |
| It’s non-farm payrolls day in the US. Economists polled by Reuters are predicting that 190,000 jobs were added in February, following 227,000 in January. | It’s non-farm payrolls day in the US. Economists polled by Reuters are predicting that 190,000 jobs were added in February, following 227,000 in January. |
| It would take an absolute shocker on the downside to derail expectations that the Federal Reserve will raise rates at its policy meeting on Wednesday next week. | It would take an absolute shocker on the downside to derail expectations that the Federal Reserve will raise rates at its policy meeting on Wednesday next week. |
| Victoria Clarke, economist at Investec, said a rate hike next week is pretty much a done deal: | Victoria Clarke, economist at Investec, said a rate hike next week is pretty much a done deal: |
| The Fed looks to be locked onto a course that would see it raise the Fed funds target rate range by 25 basis points to 0.75-1.00%, short of a sizeable shock to market sentiment and/or a massive downside surprise in the February payrolls report. | The Fed looks to be locked onto a course that would see it raise the Fed funds target rate range by 25 basis points to 0.75-1.00%, short of a sizeable shock to market sentiment and/or a massive downside surprise in the February payrolls report. |
| Note that with a March hike effectively a done deal, the key focus for markets will be the forward guidance on the prospect of rate rises ahead. | Note that with a March hike effectively a done deal, the key focus for markets will be the forward guidance on the prospect of rate rises ahead. |
| Some economists think today’s payrolls number could come a fair bit stronger than consensus expectations, not least because of a strong ADP jobs report on Wednesday, which easily beat expectations. | Some economists think today’s payrolls number could come a fair bit stronger than consensus expectations, not least because of a strong ADP jobs report on Wednesday, which easily beat expectations. |
| We’ll be tracking all the main events through the day... | We’ll be tracking all the main events through the day... |