–Q3 Revised GDP +0.6% q/q; +0.5% y/y
LONDON (MNI) – Economic growth in the third quarter was revised up
slightly, but the outlook for growth remains fragile, figures released
from National Statistics showed Thursday.
GDP was revised up to show an increase of 0.6% on the quarter in Q3
compared with the initially estimated 0.5% rise, above the median
forecast for an unrevised outturn. The data, though, are already looking
a bit historic with most analysts focusing on what happened in Q4 with
the Bank of England forecasting flat output over the quarter.
Services growth was revised up to show a rise of 0.7% on the
quarter against the initially estimated 0.6% increase. Construction
output was also revised up to show a rise of 0.3% compared with the
previously reported 0.2% fall. Industrial production was revised down to
0.2% on the quarter from 0.4%.
While a 0.6% quarterly rise in GDP looks healthy at first glance,
this followed a downwardly revised unchanged outturn in Q2 where output
was affected by the extra bank holiday among other factors. Much of
the Q3 rise in output represents a bounceback from the Q2 downturn.
On the expenditure side the data showed that the largest boost to
growth came from inventories which added 0.6 percentage point to growth
on the quarter. This could be a potential serious drag on growth ahead
as firms draw down stocks.
Household spending was unrevised at flat on the quarter and down 1%
on the year.
Net exports, which analysts and the Bank of England alike had hoped
would provide the engine of growth this year cut quarterly GDP growth by
0.4 percentage point, having knocked 0.3 percentage point off in Q2.
Government spending was revised down sharply from 0.9% on the
quarter to 0.2%, which seems to fit in more with the recent government
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