United Kingdom economic growth revised down as consumers hit by inflation

Unemployment fell in the West Midlands between October and December new figures reveal

Unemployment fell in the West Midlands between October and December new figures reveal

The downgrade of the full-year and fourth-quarter growth rates also raised questions about the strength of the economy as the Bank of England prepares to raise interest rates'. Versus the euro, the pound was down 0.2% at 1.29.

Pay growth also improved - with average weekly earnings, excluding bonuses, up by 2.5%.

GDP in the final three months of 2017 increased by 0.4% quarter-on-quarter, driven by business and financial services growth.

This is a 0.1% downward revision from the ONS's preliminary estimate of GDP growth, in part reflecting a small downward revision to the estimated output of the production industries. However, this was revised up from an earlier estimate of a 1% decrease.

Total UK GDP is nominally divided between more people as the population grows.

The Pound had already hit the ropes earlier in the Thursday morning session and was still marked down in the red after the ONS report's release, with the steepest losses seen against a resurgent Japanese Yen and the Australian Dollar.

Surveys suggest that Brexit-related trade uncertainty is prompting many managers to freeze investments.

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Sterling remained under pressure following the update, slipping 0.2 per cent against the USA dollar at 1.38.

The figures give further evidence of the overwhelming dependence of the United Kingdom economy on the services sector, which accounted for 1.3 percentage points of 2017 growth.

The figures from the Office for National Statistics (ONS) sent the pound half a cent lower against the USA dollar to just over $1.39.

Growth in the United Kingdom economy slowed past year, partly because of uncertainty over the outcome of negotiations on the future trade relationship with the European Union after Brexit takes effect in March 2019.

Separately on Thursday the CBI's latest survey of retailers showed a slowing of growth in the year to February.

"For the Bank of England, which has said rising wages are a key argument for tighter monetary policy, today's data makes a May rate hike all the more likely although as always, this still relies on renewed Brexit progress over coming weeks", said James Smith, developed markets economist at ING.

In comparison, January of 2017 saw a 19.1 per cent boost to e-commerce spending, which shows just how much the market has decelerated in the past 12 months.

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