PREVIOUS TRADING DAY EVENTS 13 July 2023

The U.K. monthly real Gross Domestic Product GDP figure reported yesterday suggests that GDP is estimated to have fallen by 0.1 in May 2023 after a growth of 0.2 in April 2023. A less negative figure than the expected 0.3.

A series of upward surprises for the U.K. made it possible to avoid a recession that forecasters, including the Bank of England and International Monetary Fund, had expected earlier this year.

Overall, consumption growth could remain sluggish until well into next year as households face multiple economic headwinds, said Yael Selfin, chief economist at KPMG UK. While stronger pay growth and falling inflation could see real incomes start growing again, the impact of higher mortgage costs and rising rents could weigh on household spending.

Todays GDP figure showing 0 growth in the three months to May provides further evidence of the precarious state of the UK economy, said David Bharier, head of research at the British Chambers of Commerce. Most firms are still not reporting improved business conditions.

Analysts will keep a close eye on Junes data.

Junes data will likely be flattered by a return to the usual number of working days, said Ben Jones, lead economist at the CBI employers group. Activity in the private sector has remained firm in recent months.

UK GDP held up better than expected in May despite the drag from an extra national holiday. The reading adds to the picture of a resilient economy thats…