UK economic growth data to be released on Friday
Today, the United Kingdom Office for National Statistics (ONS) will release figures on second quarter GDP growth.
Last quarter, thanks to a sharp contraction in the construction sector, weaker manufacturing growth and a squeeze on consumer spending, the UK experienced its weakest GDP period of growth in over five years (0.1%).
Moreover, Brexit uncertainties continue to trouble currency hawks. The euro has seen a strengthening across the board, whereas the pound fell 0.4% to 89.620 pence per euro, the British currency’s weakest since early March of this year.
Expect another quarter of low GDP growth, no more than 0.6%, making it unlikely that the data released today will mollify investors. Not until the UK’s greater economic woes abate and the course of Brexit negotiations become clearer will investors view GDP as a reliable indicator of Britain’s economic environment. Additionally, the direction of Brexit talks will impact investor confidence. Should a Brexit deal collapse or the direction of negotiations remain opaque, investors could be spooked, resulting in further harm to domestic markets.
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