020 7898 0500Following the UK’s disappointing retail sales figures last week, there will be a lot of focus on the first release of the UK’s first quarter Gross Domestic Product (GDP) data. It’s expected to show that the UK grew by 0.4% quarter on quarter.
However, Friday’s disappointing retail sales figures put this in jeopardy as consumer spending makes up close to 70% of GDP. Sterling had been on a positive run after the snap election announcement by Theresa May, although with inflation rising and retail sales showing a prolonged decline, there will be some concern that a mild form of stagflation could emerge.
News over the coming weeks will likely be dominated by the political party manifestos and whether the public will be voting for a hard or soft Brexit. It was interesting to see Jeremy Corbyn make a move towards what could be seen as a populist policy, with his announcing he wanted to create four new UK-wide bank holidays. Labour highlighted the fact that the UK has fewer bank holidays than most other G20 countries, so it will be interesting to see if this influences their position during the short campaign.
It’s worth noting that the Liberal Democrat’s membership has passed the 100,000 mark following a surge of new joiners since the general election announcement. They stated that they have signed up 12,500 new members since last week – and the total figure is expected to reach its highest total in history ‘within days’.
On the economic docket today we have the public sector borrowing figures, which are expected to show that the budget deficit is growing. This will probably be mentioned over the coming weeks.
