Investment Clock insights

Strong consumer activity lifts UK GDP


Ian Kernohan

26 January 2017

Far from plunging into recession after the vote to leave the EU, the UK was actually the fastest growing G7 economy in 2016.  GDP grew by 0.6% quarter on quarter in the final three months of 2016, faster than expected. This included strong contributions from consumer-focused activities, business services and finance.   
Looking ahead to 2017, the major question is whether a squeeze on real household incomes, and the impact of Brexit uncertainty on the corporate sector, will be offset by the benefits of cheaper sterling against a stronger backdrop of global economic growth.
The value of investments and the income from them is not guaranteed and may go down as well as up and investors may not get back the amount originally invested. The views expressed are the author’s own and do not constitute investment advice.

Far from plunging into recession after the vote to leave the EU, the UK was actually the fastest growing G7 economy in 2016.  GDP grew by 0.6% quarter on quarter in the final three months of 2016, faster than expected. This included strong contributions from consumer-focused activities, business services and finance.  

Looking ahead to 2017, the major question is whether a squeeze on real household incomes, and the impact of Brexit uncertainty on the corporate sector, will be offset by the benefits of cheaper sterling against a stronger backdrop of global economic growth.

The value of investments and the income from them is not guaranteed and may go down as well as up and investors may not get back the amount originally invested. The views expressed are the author’s own and do not constitute investment advice.