Last week’s Markit/CIPS surveys pointed to a slowdown in GDP growth in the first quarter, a picture supported by other activity surveys. But while the economy seems to be going through a slightly sluggish patch, let’s not get too worried just yet.
After all, the main measures of consumer and business confidence do not suggest that sentiment is plummeting. Our best guess is that the economy grew by about 0.5% in Q1, a bit slower than in Q4, but not dramatically so. And even if growth does slow sharply as the referendum gets closer, if the UK votes to stay in the EU, we will probably see a bounce-back in Q3.
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