The Economic Recovery Continues in the UK During Q3
The UK GDP posted another strong increase for July
The UK economy took a deep plunge during Q2, as most major economies did, apart from China, which passed this phase a quarter in advance. We saw a 5.5% contraction in March and another contraction of more than 20% in April, during the height of the lock-downs.
The situation started to improve as the world started to reopen and the GDP has been increasing since then. The economy seems on track, posting another decent increase today, but the slowdown in Europe and Brexit will soften the tone in the coming months, so we will see if the UK will be able to keep the pace as the year progresses.
Latest data released by ONS – 11 September 2020
- July monthly GDP MoM +6.6% vs +6.7% expected
- June monthly GDP was +8.7%
- GDP 3M/3M -7.6% vs -7.5% expected
- GDP 3M/3M -19.1%
The figures here just reaffirms a continued rebound in the UK economy to start Q3, with the further reopening of the economy and the government’s stimulus measures helping out. But it remains to be seen if this can all hold up going into the latter stages of Q3 and that is where the focus is at right now, not to mention that the pound is also mired by the ongoing Brexit uncertainty seen this week.
Factory Activity Data:
- Manufacturing production +6.3% vs +5.0% m/m expected
- Prior +11.0%
- Manufacturing production -9.4% vs -10.5% y/y expected
- Prior -14.6%
- Industrial production +5.2% vs +4.1% m/m expected
- Prior +8.7%
- Industrial production -7.8% vs -8.7% y/y expected
- Prior -12.5%
- Construction output +17.6% vs +10.0% m/m expected
- Prior +23.5%
- Construction output -12.7% vs -17.6% y/y expected
- Prior -24.8%
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