• Quarterly GDP for the UK came in at -0.3% in Q4 vs. -0.1% estimate.
  • UK GDP arrived at -0.1% MoM in December vs. -0.2% forecast.
  • GBP/USD keeps losses near 1.2550 on the UK GDP data.

The UK economy shrank 0.3% QoQ in the three months to December, compared with a 0.1% contraction seen in the thrid quarter of 2023. The market consensus was for -0.1% in the reported period.

Annually, the UK GDP contracted 0.2% in Q4 vs. 0.1% expected and the third quarter’s 0.3% growth. The UK GDP declined 0.1% MoM in December, as against a 0.3% increase reported in November, beating the forecast of -0.2%.

Meanwhile, the Index of services (December) arrived at -0.2% 3M/3M and -0.2% prior and 0.1% expected. Other data from the UK showed that Industrial Production and Manufacturing Production increased by 0.6% and 0.8%, respectively, on a monthly basis in December. Separately, Total Business Investment rose by 1.5% on a quarterly basis in the final quarter of 2023.

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Market reaction to the UK GDP data

UK GDP figures failed to have any significant impact on the Pound Sterling market. At the time of press, GBP/USD was virtually unchanged on the day at 1.2557.

GBP/USD Daily Chart

Source: TradingView, FXStreet