GDP growth at fastest rate in three years........ .............and interest rates at it lowest By Holly Black GDP grew 0.8 per cent in the third quarter of 2013, its fastest rate in three years. The preliminary figures from the Office for National Statistics indicate that momentum in the UK economy increased between July and September, building on the 0.7 per cent rise recorded between April and June. The ONS says output increased in all four main industrial groupings in the economy - agriculture, production, construction and service. The latter is now slightly above its previous peak, which was in 2008 before the global financial crisis. GDP is also 1.5 per cent higher than it was for the same period in 2012. Samuel Tombs, UK economist at Capital Economics, says that although the recovery would look to be gathering momentum, ‘in the grand scheme of things, the UK’s recovery remains unimpressive’. ‘Further falls in real pay, the fiscal squeeze and the dormant state of the eurozone economy seem likely to prevent the recovery from gathering pace. However, with employment growing, confidence returning and productivity still well below its potential, it seems unlikely [it] will fade significantly either,’ he adds. Azad Zangana, European economist at Schroders, says all eyes will now be on the Bank of England for an update on its forward guidance. ‘Due to the unemployment rate falling somewhat faster than expected, the Bank may bring forward its own forecast of when it may start considering an increase in interest rates,’ he says. Source: Observer
Posted on: Tue, 29 Oct 2013 10:48:56 +0000
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