› The Conservatives have lost their absolute majority in the British parliament, further weakening the government’s ability to negotiate the UK’s exit from the European Union
› Uncertainty surrounding the outlook for the UK is expected to remain strong and impact activity levels over the coming quarters. In line with our expectations, the pound sterling could fall significantly
› Although more confident about the outlook for growth, the ECB has confirmed that monetary tightening is not imminent. The euro’s upside pressures are therefore expected to be limited
Focus on India: Growth potential still intact (p.5)
› With 6.1%, GDP growth for the first quarter of 2017 was disappointing and reflects the delayed – and higher-than-expected – impacts of the demonetisation, as well as statistical biases. This slowdown is expected to be temporary
› Private consumption has continued to trend up, while the legislative elections at the start of the year reinforce N. Modi’s political legitimacy
› Private investment is still the weakest link and needs to be supported by bank lending
Macro Highlights - June 12th 2017 - UK Elections, ECB & India
