United Kingdom: Economy expands more than initially projected in Q2
August 23, 2013
In the second quarter, GDP expanded a seasonally-adjusted 0.7% over the previous quarter, according to more detailed figures released by the Office for National Statistics (ONS) on 23 August. The reading was revised up from the preliminary estimate of a 0.6% expansion and came in slightly above market expectations, which also had GDP growing at 0.6%.
Revised figures showed that the acceleration reflected improvements in all sectors of the economy. Agriculture recorded the strongest increase at 1.7% quarter-on-quarter (previously reported: +1.1% qoq), followed by construction (Q2: +1.4% qoq; previously reported: +0.9%). Industry and services expanded at the same 0.6% pace.
In annual terms, GDP grew 1.5% in the second quarter (previously reported: 1.4%). The Bank of England (BoE) raised its projections in its latest inflation report from August. The BoE now expects the economy to grow 1.4% this year and 2.5% next year (previously reported: 1.2% and 1.7% respectively). FocusEconomics Consensus Forecast panellists are less optimistic and expect the economy to grow 0.7% this year, which is unchanged from the previous month's estimate. The 2013 estimate is a notch above the revised 0.6% projected by the Office for Budget Responsibility (OBR). In 2014, the FocusEconomics panel sees growth accelerating to 1.5%.
Author: Dirina Mançellari, Senior Economist