UK Economic Data Overview

Friday's packed UK economic docket highlights the release of the preliminary Gross Domestic Product (GDP) print for the first quarter (Q1) of 2023 at 06:00 GMT. The UK economy is expected to have expanded by a modest 0.1% during the January-March period and the yearly growth is anticipated to decelerate from 0.6% to 0.2%. 

This will be accompanied by Manufacturing Production and Industrial Production data for the month of March. Manufacturing output, which makes up around 80% of total Industrial Production, is seen contracting by -0.1% MoM during the reported month. Meanwhile, the total Industrial Production is expected to remain flat in March as compared to the 0.2% decline recorded in the previous month. The UK Goods Trade Balance will also be reported at the same time, which is likely to show a deficit of £17.5 billion in March. 

How could the data affect GBP/USD?

Ahead of the key releases, the GBP/USD pair edges higher and recovers a part of the previous day's post-Bank of England (BoE) slump to over a one-week low amid subdued US Dollar (USD) price action. A surprisingly stronger UK macro data, especially the GDP print, could provide a modest lift to the British Pound and allow the major to capitalize on its modest intraday uptick. Conversely, even a slight disappointment should be enough to exert additional pressure on the Sterling and pave the way for an extension of the pair's recent sharp pullback from over a one-year high touched on Wednesday.