Market Mindset

GDP Growth: 1.4% (Nov 2025)

R.GDP: $3.96 trillion (2025)

GDP per Capita: $56,661 (2025)

Quarterly GDP: 0.1% (Q4 2025)

Inflation: 3.4% (Dec 2025)

Base Rate: 3.75% 

Market Expectation for base rate, year-end 2026: 3.25%

CPI: 3.4% (Dec 2025)

Core CPI: 3.2% (Dec 2025)

CPI Monthly Change: 0.4% (Dec 2025) 

RPI: 4.2% (Dec 202%)

National Unemployment rate: 5.1% (Nov 2025)

Average House price: £270, 493 (Feb 2026)

Current account deficit: £10.5 billion

Current account deficit % of gross GDP: 1.4% (Q3 2025) 

Balance of Payments deficit: £12.067 Billion 

Balance of Payments deficit % of GDP: 1.6% 

Trade Deficit (excluding precious metals): £4.6 billion

Trade Deficit (excluding precious metals) % of GDP: 0.6%

Sterling to USD exchange rate: 1/1.36 (6^th Feb 2026) 

Sterling to EUR exchange rate: 1/1.15 (6^th Feb 2026) 

Labour productivity: 1.1% (Q3 2025)

Real household disposable income Growth projection for 2026: 0.25% 

SOFR: 3.65% (Feb 5^th, 2026) 

FTSE 100: 10,323 (Feb 6^th, 2026)

STR: 1.93% (5th Feb 2026)

UK Government 10-year Gilt Yields: 4.53% (6^th Feb 2026)

Figures to watch and why: 

• SONIA: 3.73% (Feb 2026). 

SONIA essentially represents the foundation of almost all UK rate’s pricing. SONIA OIS curve embeds rate cuts, rate hikes, timing, and conviction, for consumers or influences mortgage pricing, debt hedging, bank funding costs. A rising SONIA means tighter financial conditions, and falling SONIA, credit loosens, and spending can follow. 3.73% is relatively high right now, but not at a peak seen during other times, but sill restrictive. 3.73% is around 175bps to 225bps above the neutral rate of 1.5-2.0%. SONIA is expected to come down somewhat for 2026. 

• UK Retail Sales growth: 0.4% (Dec 2025) 

Consumer demand trend shows real impact of inflation and rates, if volumes fall it can indicate if living standards are under pressure, and whether the base rate is too high. 

• UK 2-year Gilt Yield: 3.61% (6^th Feb 2026) 

This rate is a short-term curve anchor it can influence 10 and 30-year gilts – indicating near-term rates, but long enough to give colour on future moves. A high 2-year yield can show markets are expect stronger growth or persistent inflation. Lower 2-year yields, markets expect flow growth, weaker inflation or easing ahead. Fiscal and political events moved 2-year yields immediately, and how market sentiment straight away. This figure is moderate to relatively high, this figure was below 1% post 2008 and post COVID but are lower than their peak in 2022-2023 of 4.5%. 

• Consumer confidence GfK index: -16 (Jan 2026)

Forward consumer sentiment reflects the spending of the nation, how people view their personal finances and broader economic prospects, which is up from a low in April 2025 of -23. It predicts future household spending, which drives and helps predicts the UK’s GDP. 

• USD % of Global reserves: 56% (Q1 2026) 

This indicator is important to pay attention for global FX markets and the UK in relation to sterling, and its value plus GBP % of global reserve currencies. The sentiment floating around right now is one which revolves around dollar debasement. This percentage has decreased from 65.3% at the end of 2015. 

• Youth Unemployment (16-24): 15.9% (Nov 2025) 

This is a less commonly quoted figure, but signals labour market health and social stability, and potential pressure on spending and economic growth. This figure is very high, compared to overall UK unemployment rate. This figure can in turn create ‘scarring’ effects for the economy, inhibiting on long-term career growth earnings.

Disclaimer: Not financial advice