off-the-wire

UPDATE 1-Deutsche Bank no longer sees UK GDP contracting in 2023

Kitco Media
By Reuters
Published:
Updated:
Reuters
(Updates with details) April 3 (Reuters) - Deutsche Bank said on Monday it no longer expects UK's gross domestic product (GDP) to contract in 2023, after revised figures last week showed the economy grew in the last quarter of 2022.


The German bank expects UK GDP to be unchanged at 0% in 2023, a 0.2 percentage point upgrade compared to its earlier projection.


On Friday, the Office for National Statistics said UK GDP increased by 0.1% between October and December after a preliminary estimate of no growth. DB expects more supportive fiscal policy to aid the first two quarters of the year.


"Beyond H1 2023, we remain more cautious around the UK outlook, particularly with the effects of (central bank interest) rate rises feeding through more fully in to the economy, and our colleagues anticipating a U.S. recession later this year," senior economist Sanjay Raja wrote in a note. Raja says an interest rate hike from the Bank of England in May is "all but certain". The BoE has hiked for the last 11 meetings, taking the rate to 4.25% as of March.


(Reporting by Subhadeep Chakravarty; Editing by Krishna Chandra Eluri)

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