United Kingdom Economic Forecast

UK Economic Forecast

June 25, 2019

The economy has likely lost momentum in the second quarter, after Brexit stockpiling flattered the first-quarter GDP reading. Economic activity contracted sharply in April, albeit in part due to a temporary shutdown at car manufacturing plants. Moreover, the manufacturing PMI dived into contractionary territory in May for the first time in several years on lower export orders. On the flipside, the unemployment rate is at a multi-decade low, while wage growth is comfortably outpacing inflation, which is feeding through to solid retail sales. On the political front, the race to choose a new Conservative Party leader—and by extension the next prime minister—continues. Boris Johnson, who has advocated leaving the EU on 31 October with or without a deal, remains the clear favorite. However, all options remain on the table, including a general election, second referendum, leaving the EU with a deal and not leaving at all.

United Kingdom Economic Growth

This year, muted business investment, coupled with ebbing momentum in key trading partners such as the EU and U.S., will restrain the economy. However, the robust labor market should support private consumption, while a more expansionary fiscal stance should also buttress the economy. The highly uncertain outcome of Brexit remains the key risk to the outlook. FocusEconomics panelists expect GDP growth of 1.3% in 2019, which is unchanged from last month’s forecast. For 2020, panelists see the economy expanding 1.4%.

United Kingdom Economy Data

20132014201520162017
Population (million)-  -  -  -  -  
GDP per capita (USD)-  -  -  -  -  
GDP (USD bn)-  -  -  -  -  
Economic Growth (GDP, annual variation in %)-  -  -  -  -  
Domestic Demand (annual variation in %)-  -  -  -  -  
Consumption (annual variation in %)-  -  -  -  -  
Investment (annual variation in %)-  -  -  -  -  
Exports (G&S, annual variation in %)-  -  -  -  -  
Imports (G&S, annual variation in %)-  -  -  -  -  
Industrial Production (annual variation in %)-  -  -  -  -  
Retail Sales (annual variation in %)-  -  -  -  -  
Unemployment (% of active population)-  -  -  -  -  
Fiscal Balance (% of GDP)-  -  -  -  -  
Public Debt (% of GDP)-  -  -  -  -  
Money (annual variation in %)-  -  -  -  -  
Inflation Rate (CPI, annual variation in %, eop)-  -  -  -  -  
Inflation Rate (CPI, annual variation in %)-  -  -  -  -  
Inflation (PPI, annual variation in %)-  -  -  -  -  
Policy Interest Rate (%)-  -  -  -  -  
Stock Market (annual variation in %)-  -  -  -  -  
Exchange Rate (vs USD, eop)-  -  -  -  -  
Exchange Rate (vs USD, aop)-  -  -  -  -  
Current Account (% of GDP)-  -  -  -  -  
Current Account Balance (GBP bn)-  -  -  -  -  
Trade Balance (GBP billion)-  -  -  -  -  
International Reserves (USD bn)-  -  -  -  -  

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United Kingdom Facts

ValueChangeDate
Bond Yield0.84-3.04 %Jul 11
Exchange Rate1.25-0.35 %Jul 11
Stock Market7,510-0.26 %Jul 11

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