Analysts at RBS point out that UK GDP grew by 0.3% between April and May, strong enough to lift the three-monthly growth rate from nothing to 0.2% and as a result of that even after very moderate growth in June, which seems likely, and the UK will match its post-2000 average of 0.4% in Q2.
Key Quotes
“Contrary to market expectations of a 0.5% increase, May industrial production declined by 0.4% compared to April.”
“After declining in Q1, the 2.9% month on month growth in May’s construction output brings hope.”
“The BOE’s latest quarterly Credit Conditions Survey reported UK banks have increased the supply of secured credit (e.g. home loans) modestly since end-16. In contrast, the supply of unsecured debt – credit cards, store cards and car loans -, has been trimmed back over the same period.”
“The UK posted another set of fairly dismal trade figures in May, the deficit rose to £8.3bn. The cause was pretty straightforward, falling goods exports (especially cars) and rising goods imports did the damage.”
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