UK economic growth revised up to 0.3%

The Office of National Statistics (ONS) has shown that the UK economy has grown slightly quicker than expected over the opening three months of the year.

It was initially believed that the economy would by around 0.2%, however it has actually seen a rise of 0.3%.  A strong rebound in business services and industrial production helped output in be boosted, however year on year, output fell by 0.2%. This was also a slight improvement on previous estimates that predicted a 0.3% decrease.

Despite the quarterly figure going in the right direction, the growth was still smaller than that of the last quarter of 2009, when the economy saw a 0.4% growth.

The revisions were in line with analysts' expectations following the release of strong industrial output data for March.  Industrial output was expecting to see around a 0.7% rise, where in actual fact it saw a 1.2% rise.

The same figures were also shown for manufacturing output.

However, despite these rises household spending did not show any growth in the quarter.

"The key underlying message here is that we are seemingly seeing some rebalancing away from consumer spending towards industrial production," said Adam Chester from Lloyds TSB Corporate Markets.

"A welcome sign of rebalancing, but as yet it's early days. Of course what this number doesn't take into account is the fallout from the events we have seen in Europe over the last few weeks."

Posted at 04:21PM May 25, 2010 by Marc Stenton in The Economy  |  Comments[0]