Thursday, October 21

UK growth hit by biggest drag from net trade on record


 

 

Trade continues to drag on UK growth as consumer spending drives Britain’s recovery. Britain’s recovery slowed in the third quarter as growth was dampened by the biggest drag from net trade on record, official figures showed on Friday.

The Office for National Statistics (ONS) said the UK economy expanded by 0.5pc in the three months to September. This was unchanged from its previous estimate and follows an expansion of 0.7pc in the second quarter.

The figures showed Britain’s trade deficit almost doubled in the third quarter, to £14.2bn, reflecting a jump in imports, which rose by 5.5pc over the period compared with a 2.7pc fall in the second quarter.

This drag from trade was enough to knock 1.5 percentage points off growth in the third quarter, the ONS said, though the decline was more than offset by an increase in consumer spending and a rise in investment.

“The latest growth figures from the UK economy have told us a very familiar story; private consumption and government spending are making up for a very poor trade outlook,” said Jeremy Cook, chief economist at World First.