According to the Office for National Statistics, the UK’s economy grew at a slower pace than originally estimated for the first three months of this year. It was reported that GDP expanded by just 0.2% between January and March, below their first estimate of 0.3%. This is the country's weakest growth in 12 months, and follows growth of 0.7% in the fourth quarter of 2016.
The ONS said the services sector, which represents more than three quarters of output, had been weaker than anticipated. The report also highlighted declines for consumer-facing industries such as retail and hotels, and a slowdown in household spending, as well as weak growth for construction and manufacturing.
This latest estimate showed that household consumption grew at its weakest pace since the end of 2014, however business investment returned to growth after a weak finish to 2016.
The latest UK immigration figures have raised concerns with business groups, with a sharp increase in departures from the UK reported. Net migration to the UK was 248,000 last year, down 84,000 from 2015, according to official figures. The change was driven by a statistically significant increase in emigration.
The number of Americans filing for unemployment benefits increased slightly for last week, and the four-week moving average of claims hit a 44-year low. This suggests a further tightening of the labour market that could encourage the Federal Reserve to raise interest rates in June.
This was the 116th straight week that claims were below 300,000, a threshold generally associated with a healthy labour market. This is the longest such stretch since 1970, when the labour market was smaller, and the jobless rate is now at a 10-year low of 4.4 percent.
Oil prices fell around 4% to below $ 50 yesterday, as disappointment over OPEC's production policy set in among market participants.
The oil producer group had agreed to extend production cuts by nine months to March 2018. OPEC and major exporters, including Russia, agreed in December to remove 1.8 million barrels a day from the market. Investors had hoped the cartel might reduce output even further to drain a global glut that has depressed the market since 2014.
ALL DAY - G7 Meetings
13:30PM – USD : Core Durable Goods Orders m/m, expected at 0.4% against a previous of 0%
13:30PM – USD : Prelim GDP q/q, expected at 0.9% against a previous of 0.7%