 a bit more detail Mark Bailey from Fixed Securities. The question I suppose is when timeline Mark in terms of those rate increases, certainly you'd be hard pressed to think they're going to do it at this next meeting this week. Yeah good morning James I think that's exactly right I mean that's what's certainly what the market is pricing in and telling us with only a 12% chance that the Fed does hike later this week. 70% chance in June is the current pricing for the market which my personal view is that that is too high and you know we did have week data on Friday kind of quite mixed not just the GDP but consumer spending and also consumer confidence is also weaker than expected on the flip side we did have some data that was in line and slightly stronger than expected as well so but it is that mixed data front that we have seen over the last three or four weeks in the States which I think you know is pushing back those expectations of Fed hikes and as John Union said in the intro you know I think the market is hovering between that one and two hikes for this year I think you'll probably see June kind of fall off to maybe 50-50 and if we don't go in June then maybe we're just looking in either September or December again in the back end of this year. The Fed also has to consider there are a couple of swing factors that you know with regards to fiscal policy in terms of Trump and his corporate tax plan as well how whether he can actually get that through Congress and also in terms of the infrastructure spending as well so on the fiscal side in the States they're going to have to watch that closely as well to see if that does introduce any additional demand and if that does come through in the figures then you will see the Fed height put probably two times as many of the FOMC members are expecting and are highlighting to be the case. So do you just look through the first quarter I mean I know you have many people generally look back and try and explain why I noted people suggesting that warmer weather was a drag on heat dragging down heating bills weaker auto sales as well had an impact in terms of the weakness but 0.7 per cent was a big miss on expectations. No I agree and you know it's not it's not like the weather was a surprise I mean this this this is what frustrates me about you know economic data when it doesn't come in line with people's expectations or doesn't tell the story that they they want they try and explain it away you know with the weather it's not like the weather was hot and they didn't know about it you know that was that was already baked into the weak GDP number consensus of you know I think it was 1% and you had 1.2% consensus and that 0.7 print is soft and I take you know John's point on board that you know historically the first quarter has been soft and I'm certainly not expecting that to continue into the Q2 and Q3 but it is weak and unexpected and I think we have to acknowledge that and I think you saw that in terms of the the reaction in the U.S. Treasury markets you saw you saw yields fall and bond prices rise you know the 10-year benchmark came off two basis points to 2.28% and that indicates you know the data was softer than expected and I think in terms of the the pricing for the the June at 70% I think that's the one that will start to drift lower if this data continues to be mixed because I don't think the Fed will push things and I think it will always come from a very cautious point of view. I'm interested in your comments as well as to how the the Fed views any potential fiscal stimulus. I mean it seems from the previous meeting that they ignore us that until something is actually concrete in impacting the data it's it's not relevant. That's right and that commentary has been kind of repeated time and time again that you know yes they are they are looking at what the the government is doing but they're not factoring that into any of their economic forecasts which is why you know I think if there is a change to the corporate tax plan you know tax rates get cut to 15% and you do see some kind of impact there in terms of hiring GDP maybe even some wage inflation coming through and also from the infrastructure spend which again you still hasn't got through parliament because they need to have some kind of a budget neutrality to get it impermanently legislated otherwise it's only a temporary measure and if that doesn't happen or if it does happen that the the FOMC and the Fed will have to consider that in terms of how it sets its rates because it will probably see some stronger economic data coming through and as Janet Yellen reminds us time and time again you know the the moves of the FOMC are always data dependent. Yeah let's switch focus to the UK and look at their GDP in comparison point seven look pretty good point three percent for GDP growth in the first quarter for the UK that is that is nothing to shout home about. No and you know it was weaker than expected you know marginally so but I guess the the thing in the UK and we've talked about it previously is that the UK has actually performed incredibly well since Brexit and maybe just now you starting to see some of it the impact on consumer spending some of the price rises are coming through you know obviously you had a 15% depreciation in sterling so that leads to imported inflation he's starting to see some price rises coming through in supermarkets and that's impacting consumer confidence also you have a general election and the polls of the weekend you know still gave May Theresa May a strong lead in over labour kind of anywhere between 11% and 20% so maybe slightly down from the 25% initially and also as well in the UK you still got those very tricky Brexit negotiations with the the meeting on Friday in the European Union kind of solidifying their strong message that they're going to have a very tough bargaining stance because they don't want to make it look like it's an easy option for countries to leave so that's all going to take place it's all going to go in the mix and I think you're probably going to see a bit more weakness in the UK despite what looks like a fairly strong increase in majority for the ruling Conservative government so I think overall you're still looking at weaker data you probably see maybe sterling come off a bit although you have seen some short squeezes being removed from the market some hedge funds are reversed in the short sterling trade and that's why you've seen a bit of a fairly buoyant currency in terms of sterling and have seen an appreciation because you have seen a bit of stronger kind of data and also the fact the general election should lead to a stronger government that hopefully will get a better negotiated outcome out of the EU but it's going to be all difficult a lot of uncertainty you know and I think potentially sterling is potentially one that could see some depreciation over the next few months and these negotiations are expected to take two years that that seems ambitious in my opinion I thought it's going to take a little bit longer than that to get the clean break from the EU so do you expect to see this kind of Brexit uncertainty continue to act as a dampener on the UK's GDP through that period yeah I think I think you will and I think one of the key drivers that we've talked about before for the UK economy is the financial sector which is based in London and you're seeing more and more banks talking about may be moving their headquarters to Frankfurt or even to Dublin have you been to Frankfurt mark I have been to Frankfurt it is not a financial global financial sense as much as I love people from Frankfurt in the place it is not London no I agree you don't have that cultural diversity but who knows you know maybe if you get 50% of the people moving over from the UK from London over to Frankfurt then maybe you just do still start to get a bit more of a banking kind of a capital city type feel but I completely agree with you it's a bit it's a bit more sterile I've got good friends over there I used to work for Dresden a bank so our headquarters were over there in Frankfurt so I've been over several times but it is completely different field to London and it's going to be difficult to get that caliber of people to move over to Frankfurt which I think is why some some banks especially Bach because I think are looking more at Dublin as well which I guess is in English speaking as well so there's a lot of uncertainty around that and I agree with you I think the negotiations in two years massively ambitious I don't think they'll achieve that I think we'll be part way through before that two-year time horizon comes up and then they have the option to extend if the UK agrees and then all the other 27 nations agree as well which as we know in Europe is a very difficult thing to to achieve yeah indeed Mark Bailey great as always to talk thank you thanks James have a good day you too we are off to a quick break want to come back lots of breaking news for you the AI group releasing its monthly manufacturing PMI so stay with us