United Kingdom: GDP marks the strongest growth since Q3 2010
October 25, 2013
According to a preliminary estimate released by the Office for National Statistics (ONS) on 25 October, GDP expanded a seasonally-adjusted 0.8% over the previous quarter in Q3. The reading, which met market expectations, was slightly above the 0.7% rise recorded in Q2. In addition, the quarterly reading represents the highest level of growth since Q3 2010.
The increase reflected an improvement in the construction sector, which accelerated from a 1.9% increase in Q2 to a 2.5% rise in Q3. In addition, services inched up from a 0.6% expansion in Q2 to a 0.7% rise in Q3. Conversely, a slight slowdown was recorded in both industry (Q2: +0.8% quarter-on-quarter; Q3: +0.5% qoq) and agriculture (Q2: +2.0% qoq; Q3: +1.4% qoq).
In annual terms, GDP growth increased from 1.3% in the second quarter to 1.5% in the third quarter, which marks the highest level since Q2 2011. In its latest inflation report from August, the Bank of England (BoE) projects the economy to grow 1.4% this year and 2.5% in 2014. FocusEconomics Consensus Forecast panelists expect the economy to grow 0.7% this year, which is unchanged from the previous month's estimate. The panel sees growth accelerating to 1.5% in 2014, which is up 0.1 percentage points from last month's estimate.
Author: Dirina Mançellari, Senior Economist