For all the sound and fury generated by the “Brexit” debate in the last couple of months, today’s UK Q1 GDP number was expected to show a significant slowdown in economic activity at the beginning of the year.

We did see a bit of a slowdown in the quarterly numbers to 0.4%, but that was broadly as expected while the annualised number remained unchanged at 2.1%.

In a way these numbers run counter to the narrative of the “Remain” campaign that the uncertainty surrounding the referendum might do damage to the UK economy in the short term, and while most of the growth was in the services part of the economy, the slowdown being seen in manufacturing and construction is pretty much mirrored elsewhere in the global economy, so even with the June referendum and any uncertainty around that, these sectors would likely have struggled anyway.

While there may well be some truth in claims about some uncertainty, it should also be noted that Q1 growth in the US is unlikely to undergo an even more significant slowdown in numbers due to be released later this week. US Q1 GDP is expected to more than halve from 1.4% to 0.6%, with personal consumption as well as manufacturing likely to account for the majority of the drop in economic activity. Furthermore global growth is also showing signs of weakness in general, so to argue that uncertainty over the forthcoming “Brexit” vote is likely to be the sole cause of any slowdown would have been stretching the facts a little.

While today’s UK Q1 GDP numbers were slightly better than expected on an annualised basis it would be premature to get too carried away given that the numbers aren’t likely to include some of the more recent data, where we’ve seen the campaign volume ramped up by the “Remain” camp in talking down the UK economy, along with interventions from the US President and possible President-elect Hillary Clinton, warning of dire consequences if UK voters do spring a surprise and vote to leave.

It has to be said a lot of the rhetoric has been unedifying and bordering on hysteria, and does no credit to either side, and will make it that much more difficult to rebuild investor confidence in the stability of UK politics, whichever way the British people decide to vote in June.

Wider concerns about a slowdown in global growth are likely to be at the forefront of today’s Federal Reserve rate decision where the latest FOMC meeting is likely to see Fed officials leave rates exactly as they are for another two months, and shift attention towards the meeting scheduled for 14th and 15th June.

Further complicating matters will be the latest Bank of Japan rate meeting, which given the recent earthquake damage and poor economic data, will place much greater scrutiny on Japan’s next policy move given the failure of the move to negative rates to illicit a positive economic uplift.

It certainly can’t be a coincidence that the recent rebound in stock markets came about at precisely the same time as the US central bank adopted a slightly softer tone to its potential rate hike cycle, which in turn appears to have put a near term top in terms of the recent rise in the US dollar.

With that in mind this week’s central bank meetings clearly have the potential to derail the current rally if the messaging is ever so slightly off.

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