U.K. economy likely to have expanded sequentially in Q3

The British economy continued to be greatly resilient in the immediate aftermath of the Brexit referendum in June 2016, contrary to some expectations at the time. But some of the impacts that the unexpected output put into train have had economic impacts in 2017, noted Wells Fargo in a research report.

The British pound depreciated sharply following the Brexit vote that increased consumer price inflation, thus eroding growth in real income and being a drag on personal consumption spending. Therefore, the economic growth decelerated to just 1.5 percent year-on-year in the second quarter. The third quarter economic growth data is set to be released this week. The data is likely to show that the economy has grown 0.4 percent on a sequential basis, stated Wells Fargo.

“If our estimate of the sequential rate of growth is correct, it will represent some modest acceleration in the economy after two sluggish quarters in the first half of the year”, added Wells Fargo.

At 20:00 GMT the FxWirePro's Hourly Strength Index of British Pound was slightly bullish at 53.5908, while the FxWirePro's Hourly Strength Index of US Dollar was highly bullish at 141.8. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex

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