Second release slightly revises down GDP contraction in Q2

GDP reading: A second statistical release revealed GDP slid 0.3% year on year in Q2, an improvement from the 0.4% shrinkage recorded in the first release, as well as the 1.7% contraction logged in Q1. The result was the best in a year. On a seasonally adjusted quarter-on-quarter basis, economic growth was unchanged at 1.4% in Q2, matching the first release and marking the joint-fastest expansion since Q4 2022.

Drivers: Looking at a breakdown by expenditure, the annual improvement reflected household spending growth accelerating to 2.8% in Q2 from a 2.0% expansion in Q1. Similarly, public spending sped up to a 10.9% expansion in Q2 (Q1: +6.3% yoy). Conversely, fixed investment growth waned to 3.2% in Q2 from 4.7% in the prior quarter. Meanwhile, exports of goods and services slid at a more moderate pace of 5.8% in Q2, which marked the best reading in a year (Q1: -6.6% yoy). Conversely, imports of goods and services deteriorated, contracting 0.9% in Q2 (Q1: +1.8% yoy).

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