UK Final GDP arrives at -2.2% QoQ in Q1, misses estimates; Cable tests lows

UK Final Q1 GDP misses expectations across the time horizon.
GBP/USD challenges lows below 1.2300 on downbeat data.

Dhwani Mehta FXStreet

The UK GDP second estimate revealed that the economy showed a bigger-than-expected contraction, arriving at -2.2% QoQ in the first quarter of 2020 vs. -2.0% seen in the first readout, and below the consensus forecasts of -2.0%.

On an annualized basis, the UK economy’s growth rate arrived at -1.7% in Q1, slightly worse than expectations of -1.6% and down from -1.6% previous reading.

Separately, the UK Total Business Investment data arrived at -0.3% QoQ in Q1 while at +0.8% YoY for the same period. The annualized figure surprised markets to the upside.

Meanwhile, the UK Q1 Current Account deficit expanded to GBP -21.10 billion vs. GBP-15.00 billion expected and GBP-5.6 billion last.

GBP/USD reaction

The pound came under further selling pressure on the downbeat UK data dump, as GBP/USD refreshes daily lows near 1.2280 levels, down 0.16% on the day.

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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