-Q3 Preliminary GDP +1.0% q/q; unch. y/y
LONDON (MNI) – UK economic growth bounced back strongly in the
third quarter to rise at its fastest pace for five years, helped
by Olympic ticket sales, figures from National Statistics showed
Thursday.
While the outturn beat the market expectation significantly and
takes the UK out of recession, looking through a lot of the special
factors means underlying growth remains weak. A rough guide is that
taking into consideration the Jubilee impact in Q2 and the Olympic
ticket sales, underlying growth in Q3 was more like 0.3% on the quarter.
While it puts growth a little above where the Bank of England
thought it would in Q3, policymakers are likely to want to look
through the data and focus on core growth in terms of policy. Output
since Q4 2011 has only rise 0.3% — well below trend growth.
GDP rose 1% on the quarter in Q3 and was unchanged on the year
following a quarterly drop of 0.4% in Q2, the strongest quarterly growth
for 5 years. This was significantly above the median forecast for an
increase of 0.6% on the quarter and fall of 0.4% on the year.
Growth was led by services where output rose 1.3%, helped by
Olympic ticket sales which are estimated to have boosted the rise in
quarterly GDP by 0.2 percentage point.
Industrial production posted a 1.1% quarterly rise, led by a 1%
increase in manufacturing.
Output in the construction sector, however, continued its run of
falls, dropping by 2.5% on the quarter.
–London newsroom: 44 20 7862 7491; email: puglow@marketnews.com
[TOPICS: MABDS$,M$B$$$,MT$$$$]
