| Consensus | Actual | Previous | Revised | |
|---|---|---|---|---|
| Month over Month | 0.1% | 0.0% | 0.4% | |
| 3-Months over 3-Months | 0.6% | 0.6% | 0.9% | 0.8% |
Highlights
Economic growth ground to a halt in June. GDP was unchanged from its May level, a tick short of the market consensus and following an unrevised 0.4 percent gain in May. The flat monthly performance put the quarterly change at 0.6 percent, down from 0.8 percent in the three months to May, and halved annual growth to 0.7 percent.
Following a 0.3 percent monthly increase in May, output in the services sector dipped 0.1 percent, weighed down by declines in wholesale and retail trade (1.0 percent), accommodation and food (also 1.0 percent) and other services (1.4 percent). By contrast, industrial production rose 0.8 percent following a 0.3 percent advance to register its fourth gain in the last five months. Within this, manufacturing was up a solid 1.1 percent. Elsewhere, construction also expanded 0.5 percent having grown 1.7 percent in May.
Although a little softer than expected, the June data suggest that the economy still maintained respectable momentum last quarter. This should help to ease some pressure on the BoE to cut interest rates again. That said, following yesterday's generally favourable inflation report, speculation about a move as soon as next month is unlikely to fade. Today's releases put the UK RPI at minus 15 and the RPI-P at minus 4. In general, economic activity is falling slightly short of market forecasts.
Following a 0.3 percent monthly increase in May, output in the services sector dipped 0.1 percent, weighed down by declines in wholesale and retail trade (1.0 percent), accommodation and food (also 1.0 percent) and other services (1.4 percent). By contrast, industrial production rose 0.8 percent following a 0.3 percent advance to register its fourth gain in the last five months. Within this, manufacturing was up a solid 1.1 percent. Elsewhere, construction also expanded 0.5 percent having grown 1.7 percent in May.
Although a little softer than expected, the June data suggest that the economy still maintained respectable momentum last quarter. This should help to ease some pressure on the BoE to cut interest rates again. That said, following yesterday's generally favourable inflation report, speculation about a move as soon as next month is unlikely to fade. Today's releases put the UK RPI at minus 15 and the RPI-P at minus 4. In general, economic activity is falling slightly short of market forecasts.
Market Consensus Before Announcement
GDP is expected to have edged up a monthly 0.1 percent in June, putting quarterly growth at a respectable 0.6 percent.
Definition
Gross domestic product (GDP) is the broadest measure of aggregate economic activity and encompasses every sector of the economy. The monthly report is based on output data only as the income and expenditure series are not available.
Description
GDP covers all aspects 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. GDP 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. However, the monthly report is quite limited and only provides data on the main output sectors. More detailed information is available in the quarterly reports.
