Pound hits seven-month high ahead of UK GDP figures – business live

Huge day for economic news, with growth reports from the United Kingdom, the United States, France and Spain

Zing! Sterling has just hit its highest level against the US dollar since last September.

The pound has jumped by 0.3% this morning to $1.2939, a seven-month high.

Bank of America hikes its sterling forecasts to $1.32 by end of 2018: “The day of reckoning has been pushed further into the future” pic.twitter.com/nXrKm0gHsV

Gross domestic product is the economics world’s favoured way of estimating growth and output. But it’s not a perfect measure.

GDP tries to pin down how well, or badly, a country is performing by estimating how much was produced, spent, and earned across its economy. It show the output across services, industry, construction and agriculture, household and government spending, business investment, and net trade.

It counts special locks for our doors and the jails for the people who break them. It counts the destruction of the redwood and the loss of our natural wonder in chaotic sprawl.

It counts napalm and counts nuclear warheads and armored cars for the police to fight the riots in our cities. It counts Whitman’s rifle and Speck’s knife, and the television programs which glorify violence in order to sell toys to our children.

It’s worth remembering that the UK’s economy has actually held up pretty well since the EU referendum.

GDP rose by 0.5% in July-September last year, accelerating to 0.7% in October-December, dashing forecasts that a Brexit vote would quickly trigger a recession.

Breaking! Spain has shown Britain how it’s done, by reporting strong growth figures for the last three months.

#Spain #GDP Growth Rate year-on-year Flash at 3% https://t.co/1F1UQ01OYG pic.twitter.com/3Bc12iIDp6

Today’s UK growth figures, due at 9.30am, are significant for several reasons.

First, they’re the most important economic data to be released before the general election on June 8th. So a strong GDP report would bolster the Conservative Party.

Even with the expectation of activity recovering in March, the broader narrative remains that we look for GDP growth to slow in 2017.

Here’s a good chart from the FT, showing how France’s growth has fallen back:

France’s economy loses momentum at the start of 2017, with GDP growth falling to 0.3% in the first quarter https://t.co/pM9PopgxCv pic.twitter.com/hdSdDeAY6a

There’s a flurry of banking news this morning too.

Royal Bank of Scotland, which is majority-owned by the UK taxpayer, has posted its first quarterly profit since 2015. It made £259m in the three months to March, beating forecasts.

Gvt stake in Lloyds now down below 1% – contrast with 73% stake in RBS which has reported first quarterly profit since 2015 today

We’ve just learned that the slowdown in Britain’s housing market is gathering pace — another sign that the economy may be losing momentum.

Nationwide has reported that prices FELL in April for the second month running (on a seasonally adjusted basis). And on an annual basis, prices only rose by 2.6% – the slowest rate of increase since June 2013.

“There may also be more fundamental reasons for the slowdown. House price growth has been outstripping earnings growth for a sustained period of time, steadily eroding affordability on a number of metrics. For example, the typical house price is currently 6.1 times average earnings, well above the long run average of 4.3 times earnings, and close to the all-time high of 6.4 times recorded in 2007.

France’s economy was dragged back by disappointing trade figures (because exports fell while imports rose).

This breakdown of the GDP figures shows how net trade (commerce exterieur) was negative for growth.

Exports decreased in the first quarter of 2017 (-0.7% after + 1.4%), particularly in transport equipment. At the same time, imports accelerated (+ 1.5% after + 0.8%). In particular, purchases of refined petroleum products are rebounding and those of other industrial products are growing more vigorously. Overall, foreign trade weighed on growth, at -0.7 point, after a contribution of +0.2 point the previous quarter.

Q1 #French #GDP #growth limited to 0.3% q/q as net trade sharply negative. Consumer spending only edged up 0.1% q/q as energy demand weak (1

Bert Colijn, senior colleague at ING Bank, says the French growth figures are a disappointment:

#French Q1 GDP growth disappoints somewhat at 0.3% QoQ compared to 0.4% expected. Maybe soft indicators were too optimistic? Spain due at 9.

French GDP breakdown encouraging tho. Consumption slows (+0.1% QoQ), but capex picks up strongly again (+0.9% QoQ). https://t.co/yvH10KHZaa

French GDP: a huge potential if the next government provides companies with visibility and (fiscal) stability.

Breaking: France’s economy grew slower than expected in the first three months of this year.

French GDP expanded by just 0.3%, missing the 0.4% which economists had predicted.

Good morning.

We’re about to get a deluge of economic data that will show how some of the world’s largest economies have performed in 2017.

First batch of EZ Q1 GDP numbers out today. I fear a big hit from net trade in France, don’t tell Le Pen ;). Spain? 0.7%-to-0.8% as usual?

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