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Pound slips after mixed UK GDP data raises Q2 growth doubts

UK GDP rose 0.1% month-on-month in May, but TD Securities flagged construction weakness and expects Q2 growth around 0.2% quarter-on-quarter.

Reported · Written up by our desk · Major Pairs

The British pound eased after mixed UK growth signals, following data pointing to softer momentum into the second quarter. TD Securities said UK GDP grew 0.1% month-on-month in May, matching its forecast and beating the market expectation for a flat reading.

TD Securities also cited a stronger underlying pace, with three-month growth at 0.7%, driven by services and manufacturing. However, the firm said construction dragged overall activity, and it expects Q2 GDP to track about 0.2% quarter-on-quarter.

The note argued that residual seasonality may be overstating first-half performance, implying underlying growth could be closer to zero than the headline trajectory suggests. After the release, the pound pulled back, with GBP/USD dropping toward the 1.3500 area in FXStreet’s recap of the move.

Latest closeGBP/USD 1.354 ▲1.4%

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