United Kingdom GDP

United Kingdom

United Kingdom: Economic expansion continues in Q2 on the back of strong services sector

August 18, 2014

In Q2, GDP expanded a seasonally-adjusted 0.8% over the previous quarter, according to a preliminary estimate released by the Office for National Statistics (ONS) on 18 August. The print was in line with both market expectations and the previous quarter’s result.

Q2’s result was mainly driven by expansions tallied in the services and industry sectors. The strong expansion in services continued in the second quarter, growing 1.0% over the previous quarter, which was a touch up from the 0.8% rise tallied in Q1. Industry expanded 0.3% in Q2, which was down from the 0.7% tallied in the first quarter. Construction registered a flat reading in Q2, which was below the strong 1.5% expansion tallied in the previous quarter. Conversely, agriculture registered a quarterly contraction and fell 0.2%, which contrasted the 1.0% expansion tallied in Q1.

In annual terms, GDP growth increased from 3.0% in Q1 to 3.2% in the second quarter, which marked the fastest pace of growth since Q4 2007.

In its latest inflation report from August, the Bank of England (BoE) projected that the economy would grow 3.5% in 2014 and 3.0% in 2015. FocusEconomics Consensus Forecast panelists expect the economy to grow 3.0% in 2014, which is unchanged from the previous month’s estimate. The panel sees GDP expanding 2.6% in 2015.


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United Kingdom GDP Chart

United Kingdom GDP Sector Q2 2014

Note: Quarter-on-quarter changes of seasonally adjusted GDP and year-on-year variation in %.
Source: Office for National Statistics (ONS) and FocusEconomics Consensus Forecast.

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