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From a macroeconomic perspective:
• The US: Unbreakable by storms
The US economy surprised significantly to the upside in Q3, growing at a broadly similar pace as in the previous quarter. Industrial activity was hit by the hurricanes in the summer but is set to rebound towards the end of the year, while the services sector continues to register strong performance. Stronger than expected GDP growth, coupled with an increase in price pressures should support the Federal Reserve’s intentions to hike rates in December.
• The UK: Refocus on Brexit
The UK’s economic growth has accelerated somewhat over the third quarter as industrial production activity rebounded. Services sector growth remains modest, with real wages languishing in contractionary territory and the retail trade survey pointing to weaker numbers ahead. The upside surprise in third quarter GDP growth, coupled with an acceleration in inflation pressures, guided the Bank of England’s decision to hike rates by 0.25pp in November.
• The Eurozone: A foot on the gas pedal
The Euro area economy continues its growth trajectory, unabated. Strong Q3 numbers, taken together with upside revisions to previous quarters’ GDP underscore that the Euro area has stepped up a gear in its cyclical recovery. Economic sentiment remains buoyant and forward-looking indicators are pointing to a continuation in healthy economic growth. While inflation remains on the weak side, the ECB has announced cuts to its Asset Purchase Programme, halving the amount of QE from January 2018, as widely expected.