The Monday note - 28 January 2019

• The export-focused FTSE 100 fell more than 159 points last week, closing on Friday at 6,809.2, as the pound rallied to an 11-week high. The ten year Gilt yield stood at 1.31%. 
• The trade war with the US has persuaded two of Apple’s largest suppliers, Foxconn and Pegatron, to increase production outside China. Both plan to expand in India and Vietnam. 
• The Saudi Arabian government is expected this week to announce investment of $425 billion in infrastructure and industrial projects by 2030, as part of a plan to reduce the economy’s dependence on oil production. 
• The UK’s employment rate increased to 75.8% in November 2018, with the Information sector leading the way in job creation. Wages rose by 3.3% on an annual comparison. 

Chief Economist comments: 

Once again, the latest UK employment figures make upbeat reading. Low unemployment, 141,000 jobs created in three months, wage rises exceeding inflation. What a shame we have Brexit overshadowing all this good news. However, this week could see Brexit escape its ‘Groundhog Day’ cycle. Some interesting amendments could be called for debate in Parliament, and perhaps result in ‘no deal’ being removed as a threat. If that happens, overseas investors may move quickly to buy UK assets.