Thursday , January 20 2022

The UK economy is growing at the fastest rate since the end of 2016


People who work in a factoryImage copyright
Getty Images

The UK economy grew 0.6% in the three months to September, with warm weather boosting user spending, the Office for National Statistics said.

The figure for the third quarter is in line with Bank of England predictions and other prospects.

However, lively growth was refused in July, slowing down in August and September.

This is the highest quarterly growth figure since the fourth quarter of 2016, when the economy grew by 0.7%.

The analysts warned that the economy had a "basic basic momentum" and growth would decline in the last three months.

The ONS also announced a separate monthly figure for September, which, like the previous month, showed zero growth.

Three-quarters of the economy grew only 0.3%, in the three months to September.

After slow start to year, construction activity grew by 2.1% in the quarter. Manufacturing also rose after a second quarter slowly, thanks to strong car manufacturing numbers for the quarter.

Household expenditure grew by 0.5% in the quarter, but took a 1.2% business investment, suggesting uncertainty among companies over the effects of Brexit.

Business investment is expected to rise by 0.2%, according to the forecasts. He has now contracted for three consecutive quarters.


Simon Jack, business editor

Image copyright
Getty Images

The overall picture is one of the economically weak and poorly emerging, which is affecting the weather, extremely weak to year. A strong quarter of construction and energy generation, which played the weather again in July, as solar and World Cup boosted consumer spending. This is the strongest quarter for almost two years, but the economy remained not a strong momentum of July, with August and September registering no additional growth at all.

Terrible, but perhaps not surprisingly, business investment had fallen sharply, in keeping with anecdotal evidence of company warnings in front of Brexit. Although car production was compared to the second quarter this year, it has been compared to the same period last year and domestic car sales were very weak – it's exports; n keep attention to the car industry.

It's enough for the chancellor to be fun for today, but a third quarter of business investment is falling – the first time that happened since the financial crisis – shows that companies could & # 39: The sun shines now, but big clouds rise.

& Signs of weakness & # 39;

Chancellor Philip Hammond said: "Today's positive growth of 0.6% is a test of the basic strength of our economy. We build an economy that works for everyone, with 3.3 million more people work, lower than unemployment in all parts of the country, and salary rises at their fastest pace in almost a decade. "

ONS's head of national accounts, Rob Kent-Smith, said: "The strong summer economy has seen, although long-term economic growth remains flawed. There are some signs of a weakness in September, with slow retail sales and not buying cars in the home.

"However, the production of cars for export has grown across the quarter, boosting factory output. Meanwhile, car imports have dropped significantly, helping to improve the balance of British trade."

Samuel Tombs, UK's chief economist at Pantheon Macroeconomics, said: "Two consecutive months of death in GDP underline that the economy has little momentum and that the quarter quarter quarter growth rate reflects the conflict ; associated with weather in the summer.

"The GDP spending analysis, meanwhile, shows that business investment has reduced by 1.2% a quarter after a quarter at Q3, reducing the fall since the peak in Q4 2017 to 2.4%, the driver of the decline."

Suren Thiru, head of economics in the British Chambers of Commerce, said: "The stronger quarterly growth in the third quarter is likely to be one once for the UK economy, with continuing Brexit uncertainty and Financial pressures on consumers and businesses are likely to pressively increase economic activity in the next quarters. "

Source link