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Announcements continue

Tuesday, July 14, 2020

UK GDP growth for May showed a paltry 1.8% rise, far below the consensus expectations for a sharp bounce back of 5.5%. This confirms the view that any recovery in economic activity will not follow the hoped for V-shaped pattern – it’s more likely to see a much slower trajectory. Lockdowns are easing and it’s no wonder Boris Johnson wants the country to get back to work, but there are just too many negatives weighing on the UK economy in the short run. These continue to batter both consumer and business confidence. For example, hard Brexit concerns with no workable trade deal will likely continue building over the summer months, and this will weigh on sterling fortunes in an economy that is now almost a quarter smaller than it was at the start of the year. We have already heard the high profile news of job cuts across many industries over the last month, so expect the employment numbers later this week to further compound the bad news for the government.

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