The Office for National Statistics stated that the UK grew by a healthy 0.5%, defying all Brexit fears. Despite the positive data, investors are not convinced it tells the whole story, as it only showed the initial impact of Brexit, and the majority of investors seem to think the UK will struggle to avoid a downturn when Article 50 is invoked in the first quarter of 2017.

UK GDP printed at 0.5%, versus an expected 0.3%. While the important service sector increased by 0.8%, output decreased in the main industrial groups, with construction decreasing by 1.4%, agriculture by 0.7% and production by 0.4%. In light of the positive reading, the Bank of England might put on hold further emergency stimulus as the better than expected growth figure means a reduced probability the MPC will vote to slash interest rates this year.

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Article by Davide Ugolini, Senior Corporate Dealer
* Information courtesy of Currencies Direct
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