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The Guardian - UK
The Guardian - UK
Business
Graeme Wearden

UK ‘still at risk of technical recession’ despite November growth; oil price hits $80 after Yemen airstrikes – as it happened

GDP United Kingdom Economy United States Recession
The City of London, as economists digest latest GDP report
The City of London, as economists digest latest GDP report Photograph: Andy Rain/EPA

Closing post

Time to wrap up….

Here are today’s main stories:

The UK economy returned to growth in November after a recovery in consumer spending driven by Black Friday sales, with shoppers hunting for bargains as the key Christmas shopping season got under way.

But (as flagged before) some economists fear the UK could yet fall into a technical recession….

Oil prices have hit $80 per barrel as fears grew about the economic impact of disruption to international trade through the Red Sea and escalating tensions in the Middle East.

The electric car manufacturer Tesla is to halt most production at its factory near Berlin for two weeks because of delays in deliveries of parts because of attacks on ships in the Red Sea.

Burberry has warned that annual profits will be sharply lower than previously expected after consumers left its expensive trenchcoats, bags and scarves off their Christmas shopping lists.

Global Infrastructure Partners (GIP), which boasts a $100bn (£79bn) collection of companies including Gatwick airport and the Suez wastewater group, has been sold to the US investment firm BlackRock in a $12.5bn deal.

On Wall Street… JP Morgan has reported a record annual profit, while Citigroup is cutting 20,000 jobs after posting its worst quarter in 15 years.

And it’s been a busy week at the annual CES tech show in Las Vegas:

:

US travel stocks slide

Shares in US airlines are under pressure today.

United Airlines are the top faller on the S&P 500, down 8.6%, followed by American Airlines (-8.2%) and Delta Air Lines (-7.9%).

The selloff came after Delta predicts its adjusted earnings will be $6 to $7 a share this year, rather than hitting its long-term profit target of over $7.

Michael Hewson of CMC Markets explains:

Airlines are lower after Delta Airlines adjusted its 2024 profit targets lower due to concerns over higher costs saying it expects full year profits to come in between $6 to $7 a share, below the previous estimate of more than $7. Q4 revenues came in at $14.22bn and profits came in at $1.28c a share.

Cruise operators are also down, with Norwegian Cruise Line (-4%) and Carnival (-3.8%) among the main fallers on the S&P 500.

Updated

Over in the US, producers trimmed their prices last month, in a sign that inflationary pressures are easing.

The US Producer Prices Index fell by 0.1% month-on-month in December, thanks to a 1.2% monthly drop in energy prices and a 0.9% drop in food.

Overall, wholesale goods prices dropped by 0.4% while services price were unchanged.

On an annual basis, prices rose by 1.0% during 2023, showing a slowdown after a 6.4% rise in 2022.

Shipping firm Hafnia has decided to immediately halt all ships heading towards or within the Bab al-Mandab Strait and north of the 16th parallel, Reuters reports.

Hafnia said the decision was made after an advisory from the Combined Maritime Forces to stay clear of the region, after the launch of U.S. and British air strikes against Houthi forces in Yemen.

Hafnia says it is the world’s largest tanker company, with 206 vessels in its fleet.

Updated

Back on Wall Street, Citigroup has reported a $1.8bn loss for the last quarter of 2023.

Earnings were hit by $1.3bn being set aside to cover risks related to Russia and Argentina, and an $880m hit from the devaluation of the Argentinian peso last year.

Citi is also paying $1.7bn into the US Federal Deposit Insurance Corporation, through the levy to recapitalise this fund after the regional banking crisis last year.

Also, there is a $780m restructuring charge, as Citi looks to eliminate up to 20,000 jobs.

Reuters explains:

The bank announced it will reduce its headcount by 20,000 people over the medium term, the first time it estimated the workforce effect of its reorganization plan.

Citi said it expects to book charges between $700 million and $1 billion tied to the severance and reorganization.

Chief executive officer Jane Fraser said the fourth quarter was “very disappointing,” adding:

“Given how far we are down the path of our simplification and divestitures, 2024 will be a turning point.”

NIESR, the economic forecasters, have predicted the UK economy will return to growth in the first quarter of this year.

They also expect stagnation in the final quarter of last year – which would mean Britain just avoids a technical recession.

NIESR say:

We estimate that GDP flatlined in the fourth quarter of 2023, and forecast GDP to grow by 0.2% in the first quarter of 2024.

These forecasts remain broadly consistent with the longer-term trend of low, but stable economic growth in the United Kingdom.

The head of JP Morgan has warned of the risk of disruption from wars in the Middle East and Ukraine.

Jamie Dimon, chairman and CEO of JP Morgan, cited both conflicts today, as the Wall Street bank reported its results for the fourth quarter of 2023.

Dimon also pointed to the government bond sales by central banks (quantitative tightening) as they unwind their simulus packages.

He said:

Quantitative tightening is draining over $900 billion of liquidity from the system annually, and we have never seen a full cycle of tightening. And the ongoing wars in Ukraine and the Middle East have the potential to disrupt energy and food markets, migration, and military and economic relationships, in addition to their dreadful human cost.

These significant and somewhat unprecedented forces cause us to remain cautious. While we hope for the best, the past year demonstrated why we must be prepared for any environment.

JP Morgan reported net income of $9.3bn for Q4 2023, down from $13.1bn in Q3.

Its earnings were hit by a $2.9bn payment to US bank regulators to refill the Federal Deposit Insurance Corporation’s (FDIC) fund, which was drained by the collapse of several regional lenders last year.

Brent crude is continuing to rise – it’s now up 4% today, or $3 per barrel, to $80.50 per barrel.

Bloomberg are reporting that Danish fuel-tanker company Torm is halting all transits through the southern Red Sea in the wake of air strikes on Yemen.

They add:

The decision is in line with notices from industry trade groups who’ve said that military guidance is to avoid the area. Torm owns a fleet of about 80 ships.

At least four oil tankers have diverted course from the Red Sea since overnight strikes by the U.S. and Britain on Houthi targets in Yemen, according to Reuters, citing shipping data from LSEG and Kpler.

They add:

The tankers Toya, Diyyinah-I, Stolt Zulu and Navig8 Pride LHJ were all seen turning around mid-voyage in order to avoid the Red Sea between 0300 and 0730 GMT on Friday, according to ship tracking from the two companies.

One of the tankers, Toya, a very large crude carrier capable of carrying up to 2 million barrels of oil, was unladen, the data showed. The other three vessels are fuel tankers.

Allianz Trade, the international insurance company, believe the Red Sea crisis is not, yet, not a red flag for the global economy.

In a new research note, they point out that while shipping has been disrupted, prices are still some way below their levels when the Covid-19 pandemic hurt supply chains.

Ana Boata, head of macroeconomic research at Allianz Trade, says:

Due to the attacks, shipping volume in the Suez Canal declined by -15% year-on-year in the ten days leading up to Jan 7, while it dropped by -53% in the Bab-el-Mandeb Strait leading into the Red Sea.

The number of cargo ships decreased by -30% for cargo and -19% for tankers via the Suez Canal. Meanwhile, during the same period, shipping volume around the Cape of Good Hope nearly doubled, with cargo ships increasing by +66% and tankers by +65%.

Although shipping prices and especially container freight prices have increased significantly since November 2023 (+240% as of early January - see Figure1), prices are only a quarter of the peak seen in 2021 and as the demand backdrop remains weak, inventories are higher in most consumer good segments and the shipping sector has built up more capacities with new containerships, the upside risk seems lower today than in 2021.

A chart showing global shipping costs

Boata also explains how the Red Sea crisis could push up inflation, and hurt growth.

Unsurprisingly, the impact from rising shipping costs on inflation is highest in Europe and the US where a doubling of shipping costs pushes inflation up by +0.7pp (percentage points) compared to +0.3pp for China.

For global inflation, this would mean an increase of +0.5pp to 5.1% in 2024. For GDP growth this could translate into -0.9pp for Europe and -0.6pp for the US. This could translate into a loss of -0.4pp to global GDP growth to 2%.

Brent crude hits $80 for first time this year

Newsflash: the Brent crude oil price has hit $80 per barrel for the first time since 27th December.

Brent is now up almost 3.5% today at $80.10, after the US and UK attacks on Houthi-controlled areas of Yemen overnight.

Analysts at Saxo say:

Oil prices surged back to upper end of the current range, in Brent around $80, after the US and UK launched airstrikes against Houthi rebel targets in Yemen, and Iran also raised stakes as its Navy captured an oil tanker off the coast of Oman.

The gold price, often a safe-haven in troubled times, has risen a little today.

Gold is up 0.6% at $2,040 per ounce.

Marios Hadjikyriacos, senior investment analyst at XM, says the airstrikes against Yemen have boosted oil and gold.

With tensions in the Middle East already sky-high, this military strike fanned fears about a broader escalation in the region, which translated into a boost for oil and gold prices.

That said, this conflict has had little direct impact on oil production so far, so it’s questionable whether such concerns will support prices for long without further escalation that actually takes some crude barrels offline.

Shares in aerospace and defence companies are rising today too.

Weapons and combat vehicle maker BAE Systems has jumped 1.6% in London this morning. Rolls-Royce, which makes and services military engines, is up 2%.

French aircraft equipment manufacturer Safran, which makes landing gear, wheels, brakes, wiring, avionics and navigation systems, are up 3.1% in Paris.

Airbus, which makes military aircraft, are up 2.4%, while Thales – which makes a range of defence products – are 1.4% higher.

Updated

Oil could keep rising if tensions escalate further in the Middle East, warns Ricardo Evangelista, senior analyst at ActivTrades:

Evangelista explains:

Brent oil prices rose more than 3% over the last 24 hours as the markets reacted to an attack by British and American forces on Houthi targets in Yemen. The strikes came as a response to the militants’ attacks on transport ships crossing the Strait of Hormuz in the Red Sea, which they claim to be a legitimate form to pressurise Israel to halt operations in Gaza.

This attack is another escalation in the tensions that have been simmering in the Middle East since the October 7 Hamas attack, and the markets are reacting with apprehension. The Red Sea route, which leads to the Suez Canal, is crossed by the main shipping lanes between Asia and the West and is the main export route for Gulf oil.

With one of the most critical oil supply channels to the West under threat, it is not surprising to see crude prices rising in a dynamic that could create further upside for the price of the barrel should tensions continue to escalate in the Middle East.

Such an outcome would worry central bankers, as it would undermine efforts to bring down inflation to levels where interest rates can safely be cut….

Oil up as Middle East tensions increase

Oil is trading at its highest level in two weeks this morning, following the US and UK attacks on Houthi military targets in Yemen.

Brent crude, the industry benchmark, has jumped by 2.3% so far today to around $79.30 per barrel, its highest level since 28 December.

Oil had surged over $90 per barrel in the aftermath of the 7 October attacks. It then slipped towards the end of last year on forecasts of weak economic growth in 2024, meaning less demand for energy

The Brent crude oil price over the last quarter

Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown, says:

Brent crude has risen more than 2% to over $79 a barrel, as geopolitical tensions increase in the Middle East. Iran has captured an oil tanker off the coast of Oman in response to sanctions, according to reports.

Air strikes on Houthi targets in Yemen have also increased anxiety.

As flagged earlier (see here), Tesla is suspending most car production at its factory near Berlin for two weeks, due to delays to component shipments caused by attacks on vessels in the Red Sea.

Those tensions have prompted shipping firms to take the longer route around Africa, leading to delays.

Fusion Risk Management director of Third Party Risk Management Wes Loeffler warns that other firms will encounter similar problems, saying:

Organisations that have not established redundancies within their supply chains are likely to encounter delays, disruptions, or difficulties in procuring essential components that are necessary for delivering goods and services.

Mohamed El-Erian, president of Queens’ College, Cambridge and chief economic adviser at the financial giant Allianz, has also warned the UK “might have slipped into a slight technical recession in the second half of 2023”.

BBC: Red Sea attacks could shrink economy, warns Treasury

The BBC are reporting that the UK government is concerned that ongoing attacks on shipping in the Red Sea could cause the economy to shrink.

They say:

The BBC understands the Treasury has modelled scenarios including crude oil prices rising by more than $10 a barrel and a 25% increase in natural gas.

The government fears if the disruption to cargo traffic spreads to tanker traffic then another energy shock is possible.

Here’s the BBC’s Faisal Islam:

As flagged earlier, the Brent crude oil price has jumped around 2% this morning, to $79 per barrel.

That’s a two-week high, but still lower than the highs over $120/barrel seen after Russia’s invasion of Ukraine in spring 2022.

Goldman Sachs has lowered its forecast for Britain’s 2024 economic growth forecast to 0.5% from an earlier expectation of 0.6%, Reuters reports.

Updated

The Unite union warns that today’s GDP report shows the country is “teetering on the brink after a decade of economic mismanagement”, and needs “intensive care”.

Unite general secretary Sharon Graham said:

“Today’s figures only confirm what workers see and hear every single day. Our economy needs intensive care as the result of low investment, crumbling infrastructure and a cost-of-living crisis which makes daily life unaffordable.

“This is a result of choices made by our politicians over many years. It’s time we invested to improve the economy for the benefit of all”.

Here’s George Dibb, head of the centre for economic justice at IPPR, on the problems in the UK economy:

Getting back to GDP… today’s data shows how construction of new building has slowed in recent months.

New work decreased by 3.6% in the three months to November, including a 6.9% drop in activity in private new housebuilding.

That highlights the slowdown in housebuilding last year – with Persimmon reporting a 33% drop in completions earlier this week.

But, repair and maintenance rose by 3.8% in September-November.

So overall, monthly construction output is estimated to have fallen by 0.6% in the three months to November compared with the three months to August.

In November alone, new work fell by 2.0%, while repair and maintenance increased by 2.1%.

Burberry shares tumble after warning over profits.

Over in the City, shares in luxury goods maker Burberry tumbled by 10% at the start of trading, after it warned that demand was slowing.

Burberry told shareholders this morning that adjusted operating profit for the financial year to 30 March 2024 will be below its previous guidance.

Profits are now expected to be between £410m to £460m, as “the slowdown in luxury demand is having an impact on current trading”.

Back in November, Burberry said they would be at the lower end of the consensus forecast range of £552mn to £668mn.

Jonathan Akeroyd, Burberry’s chief executive officer, told shareholders:

“We are continuing to deliver the transition to our new modern British luxury creative expression for Burberry which started appearing in our stores in early Autumn.

We are still in the early stages of executing on this, which has become more challenging against the backdrop of slowing luxury demand. We experienced a further deceleration in our key December trading period and we now expect our full year results to be below our previous guidanc

The UK continued its “economic hokey cokey in November”, says Nicholas Hyett, investment analyst at Wealth Club, with 0.3% growth in GDP following the 0.3% fall in October.

Hyett adds:

With weakness in travel and hospitality, there is evidence that the cost of living crisis continues to squeeze consumers. But, high tech service industries seem to be picking up the slack, and even manufacturing is showing some signs of life, with its first positive growth since June 2023. It’s an economic muddle, albeit with some promising signs.

Resolution Foundation: Stronger than expected growth in November gives a fighting chance of avoiding recession

Britain’s stronger than expected growth in November gives “a fighting chance” of avoiding recession, says the Resolution Foundation.

James Smith, research director at the Resolution Foundation, explains:

“The economy grew more strongly than expected between October and November, driven by a recovery in our services sector including strong black Friday retail sales and a high performing ICT sector, making it less likely that Britain will fall into recession.

“The final verdict on 2023 will come next month, but it is essential that Britain builds some economic momentum in 2024.”

Economists: UK still at risk of technical recession.

Several economists are warning that the UK could have slid into a technical recession at the end of last year, even though the economy grew by 0.3% in November.

Britian would be in a technical recession if growth contracted in October-December for the second quarter running.

A technical recession would be a blow to the government ahead of the next election, even though the ONS are arguing that two small drops in quarterly GDP are not a full-blown downturn, as covered earlier.

Yael Selfin, chief economist at KPMG UK, says strike action in December will have hit GDP at the end of last year:

“The economic outlook currently remains gloomy, with a technical recession still potentially on the cards in the second half of 2023, especially given the expected impact from the industrial action in December.

Nonetheless, even if the economy manages to avoid a recession, it is expected to remain in stagnation territory.

Richard Carter, head of fixed interest research at Quilter Cheviot, says the UK remains on the brink of recession, as high interest rates hit growth:

“The UK economy grew by a modestly positive 0.3% month-on-month in November, up from the unexpected 0.3% contraction seen in October. This uplift in November is just enough to bring the UK economy back to flat growth over these two months, but it leaves an awful lot of pressure on the December figures as even a slight downward turn would result in the UK entering a technical recession after Q3 GDP was revised down to a fall of 0.1% at the end of last year.

“This morning’s figure shows just how precarious the situation is for the UK economy and piles yet more pressure onto the Bank of England to cut interest rates. The Bank has managed not to tip the UK into a recession to date, but it is looking increasingly likely that its luck may be coming to an end.

Suren Thiru, economics director at ICAEW, says the case for cutting UK interest rates soon is growing, as the economy struggles to gain momentum.

“November’s rebound may have been insufficient to prevent a small technical recession at the end of 2023, with the cost-of-living squeeze and high borrowing costs likely to have constrained output in December.

“The UK is facing a notably difficult 2024 with the lagged impact of previous interest rate rises, weaker consumer demand and moderately higher unemployment likely to stifle economic activity, despite a boost from lower inflation.

“This lacklustre GDP outturn means that interest rates will remain on hold next month. With the UK teetering on the brink of recession and inflation slowing, the case for loosening policy sooner rather than later is growing.”

Neil Birrell, chief investment officer at Premier Miton Investors, agrees that the economy may have contracted in Q4.

“The UK economy returned to growth in November, although this may not prevent the fourth quarter of 2023 being another one of contraction.

Whether the economy slides into a mild recession or not is unlikely to matter too much, but there is not much momentum moving into 2024.

However, given the inflation and interest rate pressures, this is a creditable performance and with rate cuts in the pipeline and an election looming, there is some stimulus on the way.”

Rachel Reeves MP, Labour’s Shadow Chancellor, has responded to the latest GDP figures, saying:

“The Conservatives have presided over 14 years of economic failure that has left working people worse off.

A decade of low economic growth has left Britain with the highest tax burden in 70 years, with families set to be £1,200 a year worse off under the Tories’ tax plans.

It’s time for change. Rishi Sunak should call an election and give the people the chance to vote for a Labour government that will get Britain’s future back.”

UK GDP: the key charts

These charts from the ONS show how the economy fared up to November:

A chart showing UK GDP growth to November
A chart showing UK GDP to November

Hunt welcome rise in November GDP

Chancellor of the Exchequer Jeremy Hunt has welcomed the news that the UK economy returned to growth in November.

Hunt points out that efforts to slow inflation (such as high interest rates) weighed on the economy, saying:

“While growth in November is welcome news, it will be slower as we bring inflation back to its 2% target.

But we have seen that advanced economies with lower taxes have grown more rapidly, so our tax cuts for businesses and workers put the UK in a strong position for growth into the future.”

ONS chief economist on recession risks

Q: What needs to happen for the UK to avoid shrinking in the fourth quarter of 2023, putting the economy into recession?

ONS chief economist Grant Fitzner says “everyone is obsessed” whether the Q4 GDP reading is slightly positive or slightly negative.

That data is due in a month’s time, when we also discover how the economy fared in December.

The UK would be in a ‘technical recession’ if Q4 GDP was negative, given Q3 GDP fell by 0.1%.

Fitzner, though, explains that an actual recession is more serious than just two small falls in quarterly GDP in a row [although this is a widely-held definition].

He told Radio 4’s Today Programme:

It’s important to remember that a recession is not simply a very small negative number followed by another very small negative number. It’s a significant and sustained fall in output.

We don’t expect to see that.

If December’s GDP is flat or positive, and there are no revisions to previous months, the UK might avoid a negative quarter in Q4, Fitzner adds.

The 0.2% drop in construction output in November was driven by falling housebuilding activity, Grant Fitzner explains.

The UK economy received a boost from Black Friday spending in November.

ONS chief economist Grant Fitzner is on Radio 4’s Today programme, explaining that “We have had quite a number of companies telling us they saw strong Black Friday sales”.

That had a positive impact not just on the retail sector, but also warehousing and couriers.

Fewer strikes in health and transport than earlier in 2023 also helped the economy, as did the end of the Hollywood strikes, Fitzner adds.

Here’s ONS chief economist Grant Fitzner on this morning’s GDP report:

“The economy contracted a little over the three months to November, with widespread falls across manufacturing industries, which were partially offset by increases in public services, which saw less impact from strike action.

GDP bounced back in the month of November, however, led by services with retail, car leasing and computer games companies all having a buoyant month.

The longer-term picture remains one of an economy that has shown little growth over the last year.”

But economy shrank in September-November

Despite the pick-up in growth in November, the UK economy shrank in the three months from September to November.

GDP in the three months to November fell by 0.2%, compared with the three months to August 2023.

Services showed no growth, production output fell by 1.5% and construction fell by 0.6% over the period, the Office for National Statistics reports.

Updated

UK economy grew by 0.3% in November

Newsflash: The UK economy returned to growth in November, with GDP expanding by 0.3%.

That’s slightly stronger than the 0.2% growth which City economists expected.

It follows the 0.3% contraction in October.

The Office for National Statistics reports that the UK’s services sector provided the bulk of the growth in November.

Here’s the details:

  • Services output grew by 0.4% in November 2023 and was the main contributor to the monthly growth in GDP; this follows a fall of 0.1% in October 2023 (revised up from a 0.2% fall).

  • Production output grew by 0.3% in November 2023, following a fall of 1.3% in October (revised down from a 0.8% fall).

  • The construction sector fell by 0.2% in November 2023 after a fall of 0.4% in October 2023 (revised up from a 0.5% fall).

Reuters: Tesla Berlin to stop most output for two weeks due to Red Sea disruption

Delays to deliveries to components due to the attacks on ships in the Red Sea will force Tesla to suspend most car production at its factory near Berlin for two weeks, Reuters reports.

The partial production stop will run from 29 January to 11 February, and highlights the risks that rising geopolitical tensions pose to the economy.

Reuters explains:

The partial production stop is evidence that the crisis in the Red Sea, unleashed by Iranian-backed Houthi militants attacking vessels in solidarity with Palestinian Islamist group Hamas fighting Israel in Gaza, has hit Europe’s largest economy.

The U.S. electric vehicle maker is the first company to disclose an interruption to output due to the disruption. Many companies including Geely, China’s second-largest automaker by sales, and Swedish home furnishing company Ikea have warned of delays to deliveries.

“The armed conflicts in the Red Sea and the associated shifts in transport routes between Europe and Asia via the Cape of Good Hope are also having an impact on production in Gruenheide,” Tesla said in a statement.

The UK’s services sector could help the country avoid falling into recession at the end of last year, suggets Michael Hewson of CMC Markets:

Today’s November numbers are unlikely to be anywhere near as poor [as October, when GDP fell 0.3%] and should see a modest rebound of 0.2%, with the index of services expected to drive the improvement with a strong rebound from their decline in October.

We already know from recent services PMI numbers that the UK economy appeared to rebound strongly in the final 2-months of 2023, which in turn could see the economy avoid a technical recession after the -0.1% contraction in Q3.

November is also expected to see an improvement in industrial and manufacturing production of 0.3% after the sharp declines in October.

The UK economy “likely rebounded in November”, predicts Sanjay Raja, Deutsche Bank’s chief UK economist.

He told clients this week:

Indeed, many of the factors driving the drop in output over October looked temporary. Survey data also pointed to a mild bounce back in activity. And our nowcast models point to a rebound in GDP.

What do we expect? We expect a 0.2% month-on-month expansion in GDP. Services activity, we think, will have jumped by 0.2% m-o-m, with industrial production up 0.4% m-o-m, and construction output rising by 0.1% m-o-m. Risks to our projection are skewed to the upside.

However, Deutsche has also lowered its forecast for 2023 GDP growth to 0.3%.

And it expects a “a bumpy start” to 2024, with strike activity dragging output in January.

Updated

Introduction: UK GDP report in focus

Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.

New GDP data will show how the UK economy performed in November, as it flirts with a technical recession.

Economists predict the economy returned to growth in November, with GDP expected to have risen by 0.2%.

That would be a welcome pick-up, after GDP fell by 0.3% in October, and also shrank in July-September, which put Britain on the brink of a recession.

Matthew Ryan, head of market strategy at global financial services firm Ebury, says:

We expect a modest rebound in activity that should allay fears of a Q4 recession.

But, the broader picture may be that the UK economy is stuck in neutral gear, wavering between stagnation and a minor contraction.

Bloomberg says:

It’s a bleak backdrop for Prime Minister Rishi Sunak to fight the next election, though there is some prospect of an improvement later this year.

We’ll get the figures at 7am.

Also coming up today

The financial markets are on edge after US and UK forces launched air and missile strikes in Houthi-controlled areas of Yemen overnight.

The oil price has jumped 2%, up $1.5 to around $79 per barrel.

Houthi attacks have already disrupted shipping in the region (as we covered yesterday), pushing up container costs and leading to longer delays as vessels avoid the Red Sea and reroute their journeys.

The agenda

  • 7am GMT: UK November GDP report

  • 7am GMT: UK November trade report

  • Noon GMT: India’s inflation rate in December

  • 1.30pm GMT: US PPI index of producer price inflation in December

  • 4pm GMT: Russia’s inflation rate in December

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