Good morning.
We start the day with some unexpectedly upbeat data showing that the UK economy grew by more than forecast in May.
GDP rose 0.5% in May, according to the ONS. That was a sharp improvement from April’s 0.2 percent decline, which was revised upward from 0.3 percent earlier.
The rise comes despite inflation jumping to a 40-year high in May amid rising energy costs fueled by Russia’s war in Ukraine.
Motorists are paying record prices at the pumps and household budgets are being squeezed in the biggest fall in living standards in a generation.
But the surprise jump in GDP defied expectations of a contraction in the second quarter and will calm fears that Britain will slip into recession later in the year.
5 things to start your day with
1) Europe faces nightmare of aging population in ‘absolute collapse’ As population declines, nations are left to cope with economic strain
2) Families £8,800 worse off due to ‘toxic mix’ at heart of economy Poorest French households £3,800 better off than UK counterparts, figures reveal
3) Churchill tailor Gieves & Hawkes is for sale. The retailer has also dressed Lord Nelson for the Battle of Trafalgar and the British Royal Family
4) High interest rates are temporary, says Andrew Bailey, Bank of England governor hints at possible return to ‘globally low’ rates
5) Putin raids prisons for soldiers after huge losses in Ukraine Kremlin also recruits many people from poorest parts of Russia, Western officials say
What happened in one night
Shares in Hong Kong rose slightly this morning after two days of heavy losses.
The Hang Seng index added 0.3 percent, the Shanghai Composite index fell 0.06 percent, while the Shenzhen Composite index on China’s second exchange was barely budged.
Tokyo stocks opened higher, with the Nikkei 225 up 0.5% in early trade and the broader Topix up 0.4%
It’s due today
- Economy: GDP (UK), manufacturing output (UK), industrial production (UK, EU), consumer price index (US), RICS house price balance (UK), trade balance (China)
- Corporate: PageGroup (intermediate results); JD Wetherspoon, Tullow Oil (Commercial Update)
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