However, focus of the session was on BoE's interest rate decision. Last week’s breakthrough in Brexit talks has reduced the risk of a disorderly British departure from the European Union and may boost economic confidence, the Bank of England said on Thursday after it left interest rates unchanged. BoE policymakers voted unanimously to keep rates at 0.5 percent, as expected, a month after raising them for the first time in more than a decade as inflation approached its highest level in nearly six years. Prime Minister Theresa May secured agreement from the European Commission last week that Britain had made sufficient progress in preliminary talks to move on to negotiating a transition agreement and a longer-term trade deal.
“This would reduce the likelihood of a disorderly exit, and was likely to support household and corporate confidence,” the BoE said, adding that it would consider progress on Brexit more closely when it updates its forecasts in February. The BoE’s Monetary Policy Committee stuck to its view from last month that interest rates were only likely to need to rise gradually. “The committee remained of the view that, were the economy to follow the path expected in the November Inflation Report, further modest increases in Bank Rate would be warranted over the next few years,” the BoE said.
In the US session Retail Sales and Unemployment Claims data was released. U.S. retail sales increased more than expected in November as the holiday shopping season got off to a brisk start, pointing to sustained strength in the economy that could pave the way for further Federal Reserve interest rate hikes next year. The Commerce Department said retail sales rose 0.8 percent last month, with households buying a range of goods even as they cut back on purchases of motor vehicles. Data for October was revised to show sales gaining 0.5 percent instead of the previously reported 0.2 percent increase.
Separate report on Unemployment Claims showed that in the week ending December 9, the advance figure for seasonally adjusted initial claims was 225,000, a decrease of 11,000 from the previous week's unrevised level of 236,000. The 4-week moving average was 234,750, a decrease of 6,750 from the previous week's unrevised average of 241,500.
There will be no major data releases from the UK tomorrow. In the US session Industrial Production figures will be published. Analysts predict 0.3% increase.
Figures to watch:
Industrial Production (Friday 15:15)
