United Kingdom: Economy decelerates in Q3 but less than expected
October 27, 2016
In the third quarter, the UK's GDP expanded a seasonally-adjusted 0.5% over the previous quarter, according to a preliminary estimate released by the Office for National Statistics (ONS) on 27 October. The print was down slightly from the 0.7% increase recorded in the previous quarter but exceeded the 0.3% expansion the markets had expected.
In the third quarter, industry swung from a 2.1% expansion in the second quarter to 0.4% contraction. The construction sector also deteriorated in Q3, contracting 1.4%. The figure was down from the previous quarter’s 0.1% decrease. Conversely, growth in services improved from Q2’s 0.6% to 0.8% in Q3 and the agricultural sector contracted 0.7%—an improvement over the previous quarter’s 1.0% drop.
In annual terms, GDP expanded 2.3%, which was an improvement over the 2.1% increase in Q2 and marked the fastest increase in over a year.
Author: Dirina Mançellari, Senior Economist