Fourth quarter economic growth was unrevised in the final data. A 0.3 percent drop in GDP versus the previous period left total output down 0.2 percent on the year, both figures matching their provisional readings and leaving the UK in technical recession.

The quarterly decline was in part due to the household sector where spending dipped an unrevised 0.1 percent after a 0.9 percent fall in the third quarter. However, government consumption rose a stronger revised 0.1 percent and gross fixed capital formation was up 0.9 percent, within which business investment climbed fully 1.4 percent. Business inventories (excluding alignment and balancing) added 0.5 percent.

Consequently, growth would have been more robust but for a renewed, albeit smaller revised, deterioration in the foreign trade balance. Here a 0.8 percent drop in exports was more than double a 0.3 percent slide in imports which, combined, subtracted 0.2 percentage points.

Confirmation of the onset of recession will come as no surprise and already the focus of investors and policymakers is the first quarter and what seems very likely to be a quick return to positive growth. Today's updates put the UK RPI at minus 12 and the RPI-P at exactly zero. The real economy in general is performing just as forecast with overall activity falling slightly short only due to the surprising weakness of inflation. Such a combination will support expectations for a lower Bank Rate later in the year.

No revisions are expected, leaving a 0.3 percent quarterly contraction and a 0.2 percent yearly fall.

Gross domestic product (GDP) is the broadest measure of aggregate economic activity and encompasses every sector of the economy. Since 2018, the first, or provisional, estimate includes the GDP expenditure components as well as data on the main output sectors. These results are updated in the second, and final, report.

GDP is the all-inclusive measure of economic activity. Investors need to closely track the economy because it usually dictates how investments will perform. Stock market Investors like to see healthy economic growth because robust business activity translates to higher corporate profits. The GDP report contains a treasure-trove of information which not only paints an image of the overall economy, but tells investors about important trends within the big picture. These data are readily comparable to other industrialized countries. GDP components such as consumer spending, business and residential investment, and price (inflation) indexes illuminate the economy's undercurrents, which can translate to investment opportunities and guidance in managing a portfolio.

Each financial market reacts differently to GDP data because of their focus. For example, equity market participants cheer healthy economic growth because it improves the corporate profit outlook while weak growth generally means anemic earnings. Equities generally drop on disappointing growth and climb on good growth prospects.

Bond or fixed income markets are contrarians. They prefer weak growth so that there is less of a chance of higher central bank interest rates and inflation. When GDP growth is poor or negative it indicates anemic or negative economic activity. Bond prices will rise and interest rates will fall. When growth is positive and good, interest rates will be higher and bond prices lower.

Currency traders prefer healthy growth and higher interest rates. Both lead to increased demand for a local currency. However, inflationary pressures put pressure on a currency regardless of growth. For example, if the UK reports that the consumer price index has risen more than the Bank of England's 2 percent inflation target, demand for sterling could decline. Similarly, when the Bank of England lowers interest rates, the pound sterling weakens. (Currency traders also watch the interest rate spread between countries.)