UK Q2 preliminary GDP -0.2% vs 0.0% q/q expected

Latest data released by ONS - 9 August 2019

• Prior (Q1) +0.5%
• GDP +1.2% vs +1.4% y/y expected
• Prior +1.8%

• Total business investment -0.5% vs -0.5% q/q expected
• Prior +0.4%
• Private consumption +0.5% vs +0.3% q/q expected
• Prior +0.6%
• Exports -3.3% vs -2.1% q/q expected
• Prior +1.5%
• Imports -12.9% vs -9.1% q/q expected
• Prior +10.8%

Boom 💥. Sterling falls on the headlines here as the UK economy posts its first quarterly contraction since Q4 2012 with cable falling below 1.2100 now.

The details see business investment slumping again after a brief recovery in Q1 with the aftershocks of Brexit stockpiling in Q1 being felt in the second quarter (imports basically reversing the move seen in Q1).

Consumption may have held steady but all this does is just reaffirm that Brexit uncertainty will continue to pose more problems to the UK economy as it drags on further. We could be potentially sitting on the cusp of a technical recession already.