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UK GDP preview points to tepid growth for sterling
Analysts expect annual UK growth to slow to 1.1% from 0.9% in March, a setup likely to influence whether the Bank of England keeps, or revisits, policy as inflation remains a concern.
The UK Office for National Statistics is due to publish the preliminary estimate for second-quarter GDP on Thursday, and market analysts are looking for subdued momentum. They expect GDP to rise 0.4% in the three months to June, after a 0.6% increase in the first quarter of 2026.
On an annual basis, analysts project UK growth of 1.1%, up from 0.9% in March. The release is expected to be closely watched for its impact on the British Pound (GBP), especially because preliminary figures can be revised in the following months.
FXStreet notes that the data will also come alongside other economic releases, including the Goods Trade Balance and industrial and manufacturing production. The market backdrop is largely cautious, with forecasts pointing to weak consumer spending tied to tighter credit conditions and weak real wage growth.
The article links the GDP outlook to the Bank of England's policy decisions, even though GDP is not part of the BoE's mandate. The BoE left its key interest rate unchanged at 3.75% at its early-July meeting, while the Monetary Policy Committee was split, with three of nine members voting to lift Bank Rate by 25 basis points, and inflation risks still skewed to the upside due in part to higher energy prices linked to the Middle East conflict.