GBP: Final Reading of Q4 UK GDP Revised Up – Investec
Research Team at Investec, notes that yesterday saw UK Quarterly GDP growth for Q4 last year was revised up a touch, to +0.6% from +0.5% previously estimated.
“For the year 2015 as a whole, growth was also revised up by 0.1pp, to 2.3%, while 2014 growth was confirmed at 2.9%. The big picture here is that the pattern of headline GDP growth remains unchanged, pointing to a sustained, if unspectacular, UK recovery. The data appears to confirm a picture where manufacturers, and exporters more generally, struggled last year.
But the all-important (and more domestic facing) service sector grew by 2.7% last year; accounting for the entirety of growth in the economy as a whole. Household spending growth was also a solid 2.8%.
Meanwhile, Bank of England lending data, released at the same time, showed a slight tick down in mortgage approvals and lending, albeit by less than expected after a strong January. However, any resulting gain in sterling was likely contained by the news that, in Q4 last year, the current account deficit surged to a record 7% of GDP. While UK PLC looks able to comfortably finance this deficit through borrowing from abroad, this imbalance might be one to watch going forward.”
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