UK Q3 GDP Annual Growth Strongest in 1 Year

The gross domestic product in the United Kingdom expanded 1.5 percent year-on-year in the third quarter of 2018, up from 1.2 percent in the previous period and matching market expectations. It was the strongest pace of expansion since the third quarter of 2017 mainly driven by household consumption and exports while business investment dropped the most since the first quarter of 2016.

On the expenditure side, household expenditure rose 1.8 percent in the third quarter (vs 1.6 percent in Q2); and government spending advanced 0.8 percent after being unchanged in the previous period. By contrast, fixed investment showed no growth (vs -0.6 percent in Q2) as business investment contracted the most since the first quarter of 2016.

Exports rose 0.7 percent, following a 0.8 percent gain in Q2; while imports declined 0.5 percent, after increasing by 0.6 percent the previous period. As a result, the trade deficit narrowed to £1.655 billion from £3.530 billion in Q3 2017. 

On the production side, the service industries expanded 1.7 percent (vs 1.5 percent in Q2), as output rose for: distribution, hotels and restaurants (2.8 percent vs 2.3 percent); transport storage and communications (4.1 percent vs 3.3 percent); business services and finance (1.3 percent vs 1.6 percent); and government and other services (0.3 percent vs 0.2 percent). Industrial production went up 0.7 percent (vs 0.8 percent in Q2), as output rose for: manufacturing (1 percent vs 1.3 percent); mining and quarrying (0.4 percent vs -1.1 percent); and water supply, sewerage, waste management and remediation activities (0.5 percent vs -0.4 percent). Electricity, gas, steam and air conditioning supply shrank 1 percent after a 0.7 percent contraction in the previous period. Construction expansion picked up to 2 percent from 0.4 percent in Q2.

UK Q3 GDP Annual Growth Strongest in 1 Year

ONS | Joana Ferreira |
11/9/2018 10:14:00 AM