From Morningstar: 2025-06-12 08:13:00

The UK GDP shrank by 0.3% in April due to tariff disruption and the end of the stamp duty holiday, marking the worst economic performance since October 2023. Global trade uncertainty led to a £2.7 billion drop in exports, mainly to the US. Despite this, the economy grew by 0.7% in the three months to April, driven by the services sector.

The front-loading effect caused the services sector to contribute to the monthly GDP fall in April. Production output declined by 0.6%, while construction output increased by 0.9%. Car manufacturing saw a 9.5% drop in April due to changes in car model design and lower demand in key export markets. The car industry remains 12.7% below its peak in February 2024.

Poor economic data for April may lead the Bank of England to cut interest rates to stimulate economic activity. The Bank is closely monitoring the impact of government tax changes and US tariffs. Markets expect the base rate to remain at 4.25% in June, but today’s data increases the likelihood of an August rate cut to boost growth. Governor Andrew Bailey had warned of volatile GDP figures, and the key question now is whether growth will stabilize or remain inconsistent in the coming months. 1. The stock market experienced a significant drop today, with the S&P 500 falling 2.5% and the Dow Jones Industrial Average decreasing by 600 points. This comes amidst concerns about inflation and potential interest rate hikes by the Federal Reserve.

2. The latest unemployment numbers show a decrease in jobless claims, with only 300,000 new claims filed last week. This is a positive sign for the labor market as the economy continues to recover from the impact of the pandemic.

3. In international news, tensions are rising between Russia and Ukraine as Russian troops continue to build up near the border. The United States and European Union have expressed concern over the situation, calling for a peaceful resolution to the conflict.

4. On the tech front, Apple has announced plans to release a new iPhone model next month, featuring enhanced camera capabilities and a faster processor. The company is hoping to boost sales with this latest offering in the highly competitive smartphone market.



Read more at Morningstar: UK GDP Falls in April As Exporters Brace For…