Explore Scotland’s economic landscape in 2024: from trade and GDP trends to currency trading insights. Dive into our comprehensive analysis.
DURING the second half of 2023, business activity declined across most economies. Contractions were commonplace, notably in the Eurozone. Indications that the worst is behind us are evidenced by economic activity from November 2023. Regardless, the United Kingdom’s economy remains lacklustre, with a 0.2% growth in GDP in September 2023 and a 0% growth for the entire third quarter of the year. Increased business activity was only evident across the South-West of England, West Midlands, and London.
Economic indicators such as CPI (Consumer Price Inflation) showed signs of easing in October 2023 but remained persistently high. The core inflation rate was slightly higher at 5.6% during the year. Fortunately, the inflation rate increase has slowed, resulting in a drop in PPI (producer price inflation) for several months on the trot.
Regarding Scotland, there are encouraging signs on the horizon. Scottish GDP ticked higher by 0.1% in September 2023, with output expansion in the region of 2.7% +, construction at 0.4% +, but negative production at – 0.4% during the third quarter of the year. While Scottish GDP rose slightly in that same period by 0.4% +, it marked a reversal from the -0.3% decline in the year’s second quarter.
Source: Yahoo! Finance GBPUSD Pair
Trading and investing activity across Scotland hinges upon the overall prosperity of the United Kingdom. For example, the cable – the GBP/USD currency pair has whipsawed over the past 12 months, with a 52-week low of 1.1808 and a 52-week high of 1.3142. Currently, the GBP/USD pair is trading at 1.2696. According to currency trading activity in 2024, the GBP is off to a good start against the US dollar, given that the Fed’s dovish stance in the New Year bodes well for accommodative economic policy.
Retail and institutional traders across Scotland continue to dabble online with currency CFD options on reputable Forex trading apps. A combination of factors, including technical and fundamental elements, is necessary to understand market activity’s directional flow. The Bank of England (BOE) is more focused on the timing of interest rate cuts so as not to cause unnecessary economic shocks. Mistimed accommodative policies could result in inflationary concerns. As the crow flies, interest-rate cuts in May 2024 are expected.
The UK OBR anticipates UK economic growth of 0.7% this year and a doubling of that for 2025. Ernst & Young posit that Scotland’s economic forecast is gloomy, with a growth rate of 0.3% this year and 1.3% next year. According to the latest business statistics in Scotland, 48% of SMBs reported 0% change in turnover in October 2023. Notably, 17% indicated an increase in turnover, and 24% reported declines.
Source: Statista Value of Trade in Scotland Q1 1998 – Q2 2023
The latest Scottish trade figures from 1998 through Q2 2023 show sharp increases post-Covid. According to stats, 2023 saw approximately £27B of Scottish exports, with imports at £32.83B. This indicates a negative net trade balance of £5.74B. It is worth pointing out that robust growth has occurred since the doldrums of 2020, with a slight tapering of exports and imports heading into 2024. The Scottish Government Trade Statistics report for Q2 2023 presents interesting business-related figures. Key findings indicate the following:
| Key Findings | Year ending June 2023 | Comparison with UK |
| Value of Scotland’s worldwide goods exports | Up by 12.6% to £36.7 billion | UK increased by 12.2% |
| Value of Scotland’s worldwide goods exports (ex oil & gas) | Increased by 13.2% | UK increased by 12.0% |
| Value of Scotland’s goods exports to the European Union | Up by 12.4% to £21.8 billion | – |
| Value of Scotland’s goods exports to non-European Union countries | Rose by 13.0% to £14.9 billion | – |
| Key Findings | Year ending June 2023 | Comparison with UK |
| Value of Scotland’s worldwide goods exports | Up by 12.6% to £36.7 billion | UK increased by 12.2% |
| Value of Scotland’s worldwide goods exports (ex oil & gas) | Increased by 13.2% | UK increased by 12.0% |
| Value of Scotland’s goods exports to the European Union | Up by 12.4% to £21.8 billion | – |
| Value of Scotland’s goods exports to non-European Union countries | Rose by 13.0% to £14.9 billion | – |
| Top goods export destination | The Netherlands (19% of total exports, 74% oil) | – |
| Top goods export destination (excluding oil and gas) | USA (27% of exports were drinks) | – |
| Value of Scotland’s goods imports | Up by 12.2% | Same as UK (12.2%) |
| Value of Scotland’s total trade in goods | Up by 12.4% | – |
As we navigate through the economic landscape of Scotland in 2024, it’s evident that the region is cautiously rebounding from prior challenges. The oscillations in the currency markets, particularly the GBP/USD pair, underscore the interconnectedness of Scotland’s economy with global financial trends.
By leveraging advanced online trading apps, Scottish traders are adapting to these shifts, reflecting a dynamic and resilient economic environment. The nuanced growth patterns signal a gradual stabilisation, especially in exports and imports.
With its prudent economic strategies and a keen eye on global market movements, Scotland is poised to tread a path of steady growth, albeit with careful consideration of the broader UK and global economic climate.
This cautiously optimistic outlook aligns with the broader trends observed across the UK as Scotland adapts and evolves in an ever-changing economic landscape.
