UK 2Q GDP surpasses all expectations - Fastest Pace In 4 Years

inspector_monkfish

09:31 23Jul10 - STERLING RALLIES AFTER UK 2Q GDP SURPASSES ALL EXPECTATIONS

09:30 23Jul10 IGM - UK Q2 Prelim GDP Q/Q 1.1% vs consensus 0.6%

Indicator For Actual Consensus Previous
UK Prelim GDP Q/Q Q2-10 1.1% 0.6% 0.3%
UK Prelim GDP Y/Y Q2-10 1.6% 1.1% -0.2%



(more to follow.....)

inspector_monkfish

09:30 23Jul10 UK PRELIMINARY 2Q GDP +1.1% ON QUARTER; +1.6% ON YEAR
09:30 23Jul10 UK 2Q GDP WAS FORECAST +0.6% ON QTR, +1.1% ON YR
09:30 23Jul10 UK 2Q GDP GROWTH STRONGEST ON QUARTER SINCE 1Q 2006
09:30 23Jul10 UK 2Q CONSTRUCTION +6.6%, SHARPEST ON QTR RISE SINCE 1963 2Q
09:30 23Jul10 UK 2Q MANUFACTURING +1.6%, SHARPEST ON QTR RISE SINCE 1999 3Q
09:30 23Jul10 UK 2Q SERVICES +0.9%, SHARPEST ON QTR RISE SINCE 2007 1Q
09:33 23Jul10 UK Econ Grows 1.1% In 2Q, Fastest Pace In 4 Years
DJ DATA SNAP: UK Econ Grows 1.1% In 2Q, Fastest Pace In 4 Years

LONDON--The U.K. economy grew at its fastest pace in more than four years in the second quarter, the Office for National Statistics said Friday, in the strongest sign yet that the U.K. recovery has real momentum behind it.

In its preliminary growth data, the ONS said the economy expanded 1.1% on the
quarter and 1.6% on the year between April and June. That means the U.K. has now
expanded for three straight quarters since a deep and protracted recession.

In the first quarter, the economy expanded 0.3% on the quarter and declined
0.2% on the year.

The last time quarterly growth matched 1.1% was in the first quarter of 2006.
Quarterly growth hasn't been higher since the third quarter of 1999.

Economists surveyed by Dow Jones Newswires forecast much more modest growth
of 0.6% on the quarter and 1.1% on the year.

The data will ease concerns that the recent troubles in the euro zone and the
government's ambitious fiscal tightening plans will undercut the recovery in the
period ahead. Earlier this month, Bank of England policy makers discussed easing
policy further because of growth concerns.

The biggest contribution to quarterly growth came from the service industry,
which expanded 0.9% on the quarter--the fastest expansion in three years. That
includes an assumption by the ONS that service sector will contract 0.4% on the
month in June.

Total production expanded 1% on the quarter, while the ONS said that
construction expanded 6.6%--the biggest quarterly rise since 1963.

inspector_monkfish

09:34 23Jul10 - Cable flies after the stunning GDP result

08:34 GMT - [GBP/USD] flies after the stunning 1.1% quarterly UK GDP result in
Q2. Up about half a cent, a new high recorded of 1.5393, but we are
looking even higher and a possible 1.5473 test, the comeback best so far
(Jul 15). We do not even rule out a move on 1.5500, 1.5525 and note these
are major stops zones. Strong numbers, which should support on the
crosses too.

Blacklight

Holy shוֹt!

lemonjelly

This downturn is bizarre, & full of contradictions.

In recent times, there has been concerns that the alleged double dip was becoming more likely (& not just on here, but in the media & anecdotally a more general sentiment).

Then we get news like this...

Is this how it'll be as we continue progress?

inspector_monkfish

Cable has soared by half-a-cent to a one-week peak seven pips shy of 1.5400 on the back of the forecast-busting 1.1% first estimate of UK Q2 GDP growth. A much more modest increase of 0.6% was expected. The very strong number is good news for BoE MPC hawk Andrew Sentance, who has voted for 25bp Bank Rate hikes at the last two MPC meetings.

chucky

that will upset a good number of people on here...

double dip anyone??

Wookster

Thats really good news, I hope it will continue.

inspector_monkfish

09:41 23Jul10 - INSTANT VIEWS - UK Q2 GDP up 1.1 pct qq, biggest rise in 4 years

LONDON, July 23 - Britain's economy grew almost twice as fast as expected in the second quarter of this year buoyed by a sharp pick-up in services output and the fastest rise in construction output since 1963, official data showed on Friday.

The data, which were well above even the strongest forecast in a Reuters poll, may raise doubts over how long the Bank of England will keep interest rates at their record low 0.5 percent, particularly with inflation running above target.

KEY POINTS
- Biggest quarterly rise in GDP since Q1 2006
- Biggest annual rise in GDP since Q1 2008
- Biggest quarterly rise in manufacturing output since Q3 1999
- Biggest quarterly rise in construction output since Q2 1963
- Biggest quarterly rise in services output since Q1 2007

ANALYSTS' VIEW

SOME BIRD AT SOCIETE GENERALE
"Taking account of the fact that we also had some better numbers coming out earlier this week, taking account of the debate going on in the MPC, I think it is likely to accentuate the divides."

SOME BLOKE AT DEUTSCHE BANK
"This is a very strong rise. It is good news to the extent that the recovery seems to be gaining traction, the bad news is that it is going to take a long time before we get back to the peak levels we saw at the start of 2008."

Wookster

What is astonishing is that house prices have fallen in the face of such growth.

StevieJ

Interesting to review the growth expectations before the election, Labour and Tory, methinks that the growth projections were mocked by Osbourne, don't worry once ToryDem plans are enacted that growth will disappear :eek:

LABOUR'S rosy forecasts for economic growth were TRASHED by independent experts yesterday.

The Office for Budget Responsibility said growth will be far slower than ex-Chancellor Alistair Darling predicted in his final Budget.

http://www.thesun.co.uk/sol/homepage/news/3014274/Labour-forecasts-on-economy-trashed.html