UK Q2 GDP to come in unchanged at 0.2% - HSBC

Analysts at HSBC provide a sneak peek into what to expect from the upcoming UK Q2 advance GDP figures, which will be reported at 0830GMT.

Key Quotes:

“UK service sector growth made a reasonable start to the second quarter, rising 0.2% m-o-m in April, but we expect this to have tailed off in May, largely on the back of weak retail sales in that month: volumes fell by over 1% m-o-m, as falling real incomes started to hit home.

The services PMI survey also fell two points in May, supporting a weaker forecast for the month. UK Q1 real GDP growth was confirmed at 0.2% in the final reading.

While the strong PMIs in April had initially suggested a good bounce in growth in the second quarter, the data since then have not backed this up.

We expect a better quarter for services, but a q-o-q fall for both industrial production and construction. On this basis, we now expect Q2 growth to come in unchanged at 0.2%.”