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Today's preliminary Q2 GDP report from the UK showed real growth slowing to 0.2% on the quarter and 1.6% on the year, the weakest in three years and down from 0.3% and 2.3%, respectively, in Q1. A marked fall in construction output, the result of weakness in private house building, was largely to blame - down 0.7% on the quarter. However, the slowdown in the dominant service sector was also notable, with growth of just 0.4% on the quarter and 2.1% on the year, the weakest annual growth in 16 years. Chart 1 This report will add to expectations that the Bank of England's Monetary Policy Committee will leave interest rates on hold for the next few months. Easing Credit Growth in Euro-zone Today's ECB data on credit and money supply showed that the pace of loan growth to the private sector is easing, coming in at 9.8% on the year... [read full story]
