Expectation is for a rebound of +0.3% m/m after the drop in April
The drop in April came about a myriad of factors from Q1 stockpiling to an extensive fall in UK car production but all of it can be tied back to Brexit uncertainty weighing on economic conditions in the bigger picture.
The data for May is expected to recover slightly following the drop in April but overall, the UK economy has largely struggled in the second quarter of the year.
If the reading here comes in within expectations (+0.3% m/m), economists anticipate that it would require the UK economy to grow by a whopping 0.8% m/m in June to even post flat growth in Q2 2019.
Hence, that is the focal point that markets should pay attention to rather than the headline reading itself. As such, we may see some improvement in domestic conditions and possibly even a surprise to the upside potentially. But barring a miracle from June data, the UK economy is likely to have contracted in Q2 for the first time in seven years.
Therefore, going by sentiment, any reprieve for the pound from a more positive beat here will likely just be for the short-term if anything else.