UK gross domestic product growth has slowed in the third quarter compared to Q2, increasing by 0.5 per cent, according to estimates from the Office for National Statistics.
The estimate, released today, shows that GDP has risen by 0.5 per cent between July and September, compared with a 0.7 per cent rise in Q2.
Construction growth slowed in Q3 by 2.2 per cent, while services increased by 0.7 per cent, production rose by 0.3 per cent and agriculture went up by 0.5 per cent. However, within production manufacturing fell by 0.3 per cent.
“The manufacturing sector, which represents 10 per cent of the economy, is battling twin headwinds of a stronger pound and weaker demand from abroad as the global economy falters,” says Ben Brettell, senior economist at Hargreaves Lansdown.
Compared to Q3 last year, GDP has risen by 2.3 per cent and is 6.4 per cent higher than the pre-economic downturn peak of Q1 2008.
“It’s important to remember this is only the first estimate of GDP – based on less than half of the data which will ultimately be available. Revisions to today’s figures are likely in the coming months,” says Brettell.
“Overall the domestic economy looks in reasonable health, with growth solid,if unspectacular, employment at an all-time high and inflation low. However, the global outlook is undoubtedly darker and this could act as a brake on growth over the next few quarters,” he adds.
“Despite the third quarter slowdown and increasing pessimism in some quarters, we are relatively upbeat over UK growth prospects – although the manufacturing sector is clearly currently a cause for serious concern,” says Howard Archer, chief UK and European economist at IHS Global Insight.