Business investment in the United Kingdom dropped 1.1 percent on quarter in the three months to September of 2018, following an upwardly revised 0.4 percent fall in the previous period, and below than a preliminary reading and market expectations of a 1.2 percent decline, final estimates showed. It is the third consecutive quarter-on-quarter fall in business investment and the first time it declines for more than two straight quarters since the economic downturn of 2008 to 2009, mainly driven by transport, and information and communication technology (ICT) equipment and other machinery and equipment, which contributed negatively by 1.0 and by 0.9 percentage points respectively. Meanwhile, other buildings and structures made a positive contribution of 0.7 percentage points, while intellectual property products’ contribution was flat. Year-on-year, business investment decreased 1.8 percent, after rising 0.2 percent in the prior quarter and below market consensus of a 1.9 percent decline. Private Investment in the United Kingdom averaged 1.04 percent from 1967 until 2018, reaching an all time high of 63.70 percent in the second quarter of 2005 and a record low of -33.70 percent in the third quarter of 2005.
Private Investment in the United Kingdom is expected to be -0.60 percent by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate Private Investment in the United Kingdom to stand at 0.50 in 12 months time. In the long-term, the United Kingdom Business Investment is projected to trend around 0.50 percent in 2020, according to our econometric models.