The UK economy is defying the EU Referendum for the second time in a row, growing by 0.6% q/q and 2.2% y/y in Q4 2016. Both figures are 0.1% above early estimations.
This kind of expansion is not steaming hot or inspiring but it is certainly solid and healthy. And, when taking the projected “Brexit cliff” into consideration, this is great news. Economists, the Bank of England and also the British government predict slower growth in 2017.
UK PM Theresa May is in the US, about to meet President Trump, while her Brexit minister is pushing through with a bill to approve Article 50, the formal announcement of leaving the EU, in parliament. The exit is expected to occur by the end of March. Will the UK economy begin struggling after the official proclamation?
GBP/USD reaction
Sterling/dollar has been on the rise in the past few days, advancing all the way to a high of 1.2677, that came earlier this morning. This is still under the initial post-Brexit low of 1.2790 but well above 1.20 seen last week.
From these highs, the pair is sliding back down after the release. Cable is now trading at 1.2630, selling the fact.
More: GBP: UK Court Ruling: Scenarios & Market Implications – Deutsche Bank
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