United Kingdom: The economy remains stuck in low gear in the three months to January

According to monthly GDP data released by the Office for National Statistics (ONS), economic activity rose 0.5% in January over the prior month in seasonally-adjusted terms, contrasting December’s 0.4% fall. Despite the strong January showing, the quarter-on-quarter expansion for the November-January period was a mere 0.2%, matching the reading for October-December, and comes amid sluggish momentum in the rest of the EU and elevated Brexit uncertainty.

Looking at a sector-by-sector picture, the November-January reading was underpinned by a solid showing from the service sector, which was partially offset by contractions in the industry and construction sectors.

Over the rest of Q1, growth is likely to stay limp as Brexit uncertainty bites. The Central Bank expects the economy to expand 1.2% in 2019 and 1.5% in 2020. FocusEconomics panelists see GDP expanding 1.4% in 2019 and 1.5% in 2020.