The UK economy was doing that bad before Brexit: a growth rate of 0.6% q/q and 2.2% y/y, both +0.2% above expectations. Has the economy turned south post-Brexit? We will have to wait some time for the hard data. In addition, this release is based on partial data, especially for the first part of the quarter, far from the vote.
GBP/USD is moving higher, bouncing above 1.3130. However, the mellow market mood takes over once again and the pair slides back down towards 1.31.
The first release for the UK’s growth rate in the second quarter was expected to show 0.4% q/q and 2% y/y. These expectations reflect a full repeat of the numbers seen in Q1.
The second quarter was characterized by high tension towards the EU Referendum held towards the end of the quarter, on June 23rd. The last week may have seen a shocking halt in activity, but this will not be seen in the quarterly numbers, at least not in the initial publication.
GBP/USD traded at 1.3110 towards the release, practicing some stability, something unseen for quite some time for cable.
More: GBP/JPY Technicals: 138.75 bull/bear border
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