27 Apr 2016
UK GDP growth to remain subdued ahead of the EU referendum - Danske
According to analysts from Danske Bank, economic growth in the United Kingdom is slowing down will remain subdued ahead of the Brexit referendum.
Key Quotes:
“The Office of National Statistics has just released the first estimate of UK Q1 16 GDP growth (based on less than 50% of the total information required for the final estimate). The figures show that growth slowed to 0.4% q/q in Q1 16 from 0.6% q/q in Q4 15.”
“We believe that today’s release along with the labour market report for February supports our view that the UK economy is slowing ahead of the UK’s EU referendum.”
“According to the labour market report, employment was unchanged in January and fell in February – the first fall since May 2015. It is also worth noting that UK firms commented that Brexit uncertainties have hit demand in the latest PMI surveys. If it was only either quarterly GDP growth or employment which was falling we would be less worried but the combination of both seems to be a strong signal of a slowing economy, in our view. We expect GDP growth to remain subdued ahead of the EU referendum.”
“Slower growth, falling employment, still low inflation and subdued wage inflation mean that the Bank of England is unlikely to do anything ahead of the UK’s EU in/out referendum.”
Key Quotes:
“The Office of National Statistics has just released the first estimate of UK Q1 16 GDP growth (based on less than 50% of the total information required for the final estimate). The figures show that growth slowed to 0.4% q/q in Q1 16 from 0.6% q/q in Q4 15.”
“We believe that today’s release along with the labour market report for February supports our view that the UK economy is slowing ahead of the UK’s EU referendum.”
“According to the labour market report, employment was unchanged in January and fell in February – the first fall since May 2015. It is also worth noting that UK firms commented that Brexit uncertainties have hit demand in the latest PMI surveys. If it was only either quarterly GDP growth or employment which was falling we would be less worried but the combination of both seems to be a strong signal of a slowing economy, in our view. We expect GDP growth to remain subdued ahead of the EU referendum.”
“Slower growth, falling employment, still low inflation and subdued wage inflation mean that the Bank of England is unlikely to do anything ahead of the UK’s EU in/out referendum.”