**MNI 5 THINGS: UK Q1 Growth Poses BoE MPC Dilemma

By Jamie Satchithanantham, Laurie Laird and Jai Lakhani

     **LONDON (MNI) - The following are the key points from the ONS' preliminary

estimate of first quarter GDP published Friday by the Office for National

Statistics.

     - Brexit may be beginning to bite. The slowdown predicted after the June

2016 vote has began to take hold, with GDP rising by just 0.1% in the first

quarter -- the slowest quarterly growth since Q4 2012. Once again and as

highlighted by MNI, analysts, who pencilled in growth of 0.3%, overestimated the

result.

     - According to the ONS, the snow only had a "limited" impact on the GDP

numbers with an ONS statistician suggesting the data pointed to an underlying

trend of weakness.

     - The service sector accounted for all of the growth in Q1 but the 0.2%

expansion of the sector over Q1 was premised on an estimate of 0.1% growth in

March. However, that prediction could be subject to downward revision given

snow-induced weakness of the retail and distribution sectors in March, also

depicted by the March PMI hitting a 20-month low.

     - The latest data present a dilemma for the BoE MPC. A number of members

had began paving the way for a May rate hike, although Governor Mark Carney

attempted to damp down on that speculation last week. The BoE did not receive an

advance copy of the GDP report, according to an ONS official.

     - The brief renaissance of the manufacturing sector looks to be over. The

sector expanded by 0.2%, the slowest pace in almost a year, down from a 1.3%

surge in Q4.

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

[TOPICS: MABDS$,MAUDR$,MAUDS$,M$B$$$,M$E$$$,M$U$$$]