(Based on May 2017 data releases)
Monthly headlines:
- UK GDP growth in Q1 revised down as the trade deficit widens
- UK consumer price inflation rises to three-year high as pay growth continues to slow
- UK pay growth weakens still further
- Indian economic growth slows sharply as Brazil emerges from two-year recession
The second official estimate for Q1 2017 UK economic growth (GDP) stood at 0.2%, down from the previous estimate of 0.3%.
Retail sales rose by 2.3% in April, the strongest rate of growth since January 2016. The improvement was largely due to a 5.1% rise in the sales of clothing, footwear and textiles in April. However, with wage growth expected to continue falling in real terms, the downward pressure on retail sales is likely to increase in the coming months.
The latest UK labour market figures revealed that in the three months to January 2017, the number of people in employment rose by 122,000. However, with regular earnings growth slowing from 2.2% to 2.1% and inflation rising to 2.7% in April, earnings growth is now trailing behind price growth.
India’s economy, the world’s seventh-largest, grew by 6.1% in annual terms in Q1 2017, down sharply from the growth of 7.0% recorded in the previous quarter. The slowdown means that India has lost its place as the fastest growing economy to China. Meanwhile, Brazil, the largest economy in Latin America, grew by 1.0% in Q1 2017. This is the first time that Brazil’s economy had grown since Q4 2014 and means that it has now emerged from the country’s longest recession in history.
For full details of this month’s economic review click here.
