UK Economy Posts Unexpected 0.1% Growth in August, Sterling Rises
| Pair | Now | Since publish |
|---|---|---|
| GBPUSD | — | — |
- UK August GDP grew 0.1% unexpectedly, beating forecasts.
- Industrial Production +0.8%, Manufacturing +1.2%; Services flat, Construction -0.2%.
- Growth slowed from July’s 0.4%; GBP/USD gained 0.37%.
The United Kingdom’s economy unexpectedly expanded by 0.1% in August, according to figures from the Office for National Statistics (ONS). This growth surpassed economists’ consensus for a 0.1% contraction, with increased production offsetting declines in the services and construction sectors. Despite this positive surprise, the monthly growth rate marked a deceleration from the 0.4% recorded in both June and July, and occurred amidst a fall in consumer spending and persistent high energy prices. Following the announcement, the British pound strengthened by 0.4% against the U.S. dollar, while yields on UK government bonds (gilts) decreased across the curve. The data arrives as the economy navigates elevated borrowing costs and broader geopolitical uncertainties.
The UK’s Gross Domestic Product (GDP) grew by 0.1% month-over-month in August, as reported by the Office for National Statistics (ONS). This followed a 0.4% growth in July and contrasted with market expectations for a 0.1% contraction in August. The expansion was primarily driven by the production sector, with Industrial Production rising 0.8% MoM and Manufacturing Production increasing 1.2% MoM. However, services output registered no growth, and construction activity shrank 0.2%. Following the data release, the GBP/USD pair gained 0.37%.