Markets await UK first quarter GDP figures

| April 27, 2011
Markets await UK first quarter GDP figures

The Office for National Statistics (ONS) will today publish economic growth figures for the January to March period.

The figures are much awaited by analysts after the economy suffered a shock contraction in the last three months of 2010 – attributed to bad weather at the end of the year.

GDP is expected to expand in the first quarter but should the economy suffer a further contraction, the UK will have fallen into a double-dip recession.

Today’s figures are also likely to determine the decision of the Bank of England’s Monetary Policy Committee (MPC).
Strong growth is likely to put pressure on the Committee to lift rates, as is higher inflation.

The inflation rate is a benchmark for the MPC but the Bank continues to keep interest rates at the record low of 0.5% suggesting the economy has been too fragile to lift rates.

However, inflation eased back last month to 4% from 4.4%, relieving pressure on the Committee.

The ONS will publish GDP figures at 9:30 a.m. today.

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