The United Kingdom's gross domestic product dropped by 8.6 percent in the third quarter (year-on-year), missing analysts' expectations of a 9.6 percent contraction and exceeding the previous quarter's 9.6 percent drop. In quarterly terms, the GDP increased more than expected by gaining 16 percent during the third quarter, higher than the previously released 15.5 percent expansion.
British Finance Minister Rishi Sunak commented that the government is looking forward to putting the public finances in order so that it will be able to respond to future crises. The deficit is expected to be close to 20 percent of the GDP in the 2020/2021 year, while public debt is currently at 99.5 percent of GDP – around 2.1 trillion pounds – its highest proportion since 1962.
“When our economy recovers, it’s right that we take the necessary steps to put the public finances on a more sustainable footing so we are able to respond to future crises in the way we have done this year,” Sunak commented.
It seems that the main driving force behind the surge in the GDP is consumer spending, which gained 20 percent during the quarter.
By 9:20 GMT, the pound sterling dropped by 0.24 percent against the US dollar, falling to the 1.3431 level.
Australia's Retail Sales Surge
The Australian Bureau of Statistics reported preliminary data in which retail sales rose by 7 percent in November, after increasing by 1.4 percent in the previous month.
“The rise of these sale periods has continued to bring forward the typical Christmas shopping period from December into November,” explained an analyst at Capital Economics. “This effect may have been especially notable this year given the switch toward online shopping already made in earlier months.”
By 9:33 GMT, the Australian dollar gained 0.49 percent against the greenback, hitting the 0.7548 level.