UK economy continues contraction

While many developed countries have come out of the recession and others expected the UK to follow, the number today proved to be disappointing.  The UK economy still saw a contraction for the third quarter, although it is smaller than the contraction that was seen in the second quarter.  Estimates put the number for the third quarter at a growth of 0.3% while the Treasury had said growth is not expected until the fourth quarter.

Declines in distribution, hotels and restaurants made the largest contribution to the fall in growth.

The sharp fall in industrial output, which was deeper than the 0.5 per cent decline seen in the second quarter, came amid a particularly rapid 3.5 per cent contraction in mining and quarrying.

Construction also showed an accelerated decline in the third quarter, with output falling 1.1 per cent compared with a 0.8 per cent drop in the second quarter.

Much of the decline came from a sharp fall in distribution and from wholesale, which some economists took as a sign that destocking might have been more of a drag than expected.

Source: FT

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s