16th February 2024
A downside surprise on this morning’s UK GDP figures shows the economy contracted by 0.3% QoQ in the final three months of 2023, confirming that the economy entered a technical recession as last year drew to a close. However, such a recession is likely to be relatively shallow, and short-lived, particularly with the most recent PMI surveys having shown that economic activity has begun to pick up at the start of 2024. More broadly, the data will do little to alter the
broader, and long-running narrative, of UK economic growth remaining incredibly sluggish, nor will it do especially much to alter the BoE’s policy outlook, hence the lack of any significant reaction in the GBP, though the data will make for some rather ugly headlines for politicians to grapple with, as elections loom later this year.