UK Q1 GDP Growth Confirmed At 2% YoY

UK's gross domestic product expanded 2 percent year-on-year in the first quarter of 2017, following a 1.9 percent growth in the previous period and in line with the previous estimate. Fixed investment rose at a faster pace, with business investment increasing for the first time in over a year, while household spending growth slowed and net trade contributed negatively.

On the expenditure side, gross fixed capital formation went up at a faster 2 percent (1 percent in Q4), as business investment rebounded by 0.7 percent, following four consecutive quarters of decline. Also, household expenditure grew by 2.6 percent (2.9 percent in Q4) and government spending by 0.8 percent (0.4 percent in Q4).

Imports jumped 3.3 percent, following a 2 percent gain in Q4; while exports rose at a slower 2.9 percent, after rising by 0.6 percent the previous period. As a result, the trade deficit widened to £13.7 billion from £12.8 billion in Q1 2016. 

On the production side, the service industries expanded 2.3 percent (2.9 percent in Q4), as output rose for: Distribution, hotels and restaurants (3.5 percent from 6 percent in Q4); transport storage and communications (3.2 percent from 4.4 percent); business services and finance (2.4 percent from 2.3 percent); and government and other services (1.1 percent from 1.2 percent). Industrial production rose at a faster 2.3 percent (1.9 percent in Q4), as manufacturing growth accelerated (2.5 percent from 2 percent in Q4), and mining and quarrying rebounded (1.1 percent from -3 percent). Meanwhile, output rose at a slower pace for electricity, gas, steam and air conditioning supply (0.7 percent from 5.4 percent in Q4); and water supply, sewerage, waste management and remediation activities (3.8 percent from 5.3 percent). Construction expansion was unchanged at 2.8 percent.

UK Q1 GDP Growth Confirmed At 2% YoY

ONS | Joana Ferreira |
6/30/2017 9:39:27 AM