Partner Article

UK growth comes in below forecasts

There were a few economic points of notes today, kicking off the morning was the German Ifo
Business climate index, a survey of 6 month expectations of manufacturers, builders and retailers. It
came in ahead of expectations at 108.8, the most optimistic outlook since September.

More disappointingly however was data that showed UK GDP shrank 0.2% in the fourth quarter of
2011, against predictions of a 0.1% decrease, taking the rate of growth for the calendar year to a
meagre 0.9%. The news was sufficient to cause some profit taking in risk assets that have performed
particularly well recently. Banking stocks were amongst the biggest decliners, helping the index
trade lower throughout the morning to a level it maintained for the rest of the day.

Underlying sentiment was supported by investors focusing on an announcement that is to be made
by the Federal Reserve’s chairman Ben Bernanke later today which is expected to signal that interest
rates will be held at their record low for another two years.

There appeared to be nothing specific to mention on a stock specific level and as previously
alluded to it appeared that an element of profit taking was prevalent on a day that saw little in
the way of dramatic news out of the eurozone. The FTSE 100 finished down 0.5% at 5723, slightly
underperforming the rest of Europe and the US.

This was posted in Bdaily's Members' News section by John Dance .