UK Gross Domestic Product (GDP) Figures Due Tomorrow
Tomorrow morning the latest Gross Domestic Product (GDP) figures are due to be released for the UK which will give a good insight into how the UK economy is performing. GDP figures are used to show whether an economy is growing and if so by how much, previous figures have shown that the UK economy is growing marginally, at about 0.7% and so if the figure drops tomorrow it could be that people start to question the sustainability of the UK’s economic recovery. Even worse, should the figure fall to around the 0% mark we could face the threat of recession which could really hit Sterling exchange rates hard and lead to the Pound falling significantly. However, while the outlook may not be as strong as it was for the UK economy it is still performing well compared to the Eurozone, in fact only today German GDP figures have come in at 0.1% meaning they narrowly avoided recession (last quarter’s German GDP was at -0.1% and so 2 consecutive quarters of negative GDP means recession). So, should the UK stay steady it may highlight the disparity between the single currency economy and the UK which could help support Sterling. However, the currency market is notoriously volatile and unpredictable tomorrow’s announcement could be key for those clients looking to transfer funds internationally.
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