United Kingdom: Economy contracts again in Q4, raising concerns of a triple-dip recession
January 25, 2013
In the final quarter of 2012, GDP contracted 0.3% over the previous quarter in seasonally adjusted terms, according to a preliminary estimate released by the Office for National Statistics (ONS) on 25 January. The decline contrasted the 0.9% expansion recorded in Q3 2012, which had marked the fastest pace of growth seen in five years, and exceeded market expectations of a 0.1% drop.
The deterioration was broad-based, as all major sectors with the exception of construction fared worse compared to Q3. Most notably, the industrial sector contracted 1.8% over the previous quarter, which contrasted the 0.7% rise tallied in Q3 and marked the worst result recorded since the first quarter of 2009. In addition, agricultural output swung from a 4.2% increase in Q3 to a 0.6% decline in Q4, while the services sector recorded flat growth in Q4 (Q3: +1.2% quarter-on-quarter). Only the construction sector improved, swinging from a 2.5% contraction in Q3 to a 0.3% expansion in Q4.
In annual terms, GDP growth was flat, which mirrored the result attained in Q3.