UK growth slows post-Brexit but GDP increase was better than expected

THE economy grew by 0.5% last quarter, showing better than expected growth following the Brexit vote in June but a slowdown on last quarter.

Analysts had predicted a much lower rate of 0.3%, as there was an expectation that the economy had been affected by the surprise Leave vote at the end of June. It is much higher than the very gloomy predictions of 0.1% in the immediate aftermath of the referendum.

GDP was 2.3% higher in Q3 2016 compared with the same quarter a year ago, but the figures show a slowdown on the Q2 2016 in which the economy grew by 0.7%.

In its announcement today, the Office for National Statistics said: “The pattern of growth continues to be broadly unaffected following the EU Referendum with a strong performance in the services industries offsetting falls in other industrial groups.”

Russ Mould, investment director at AJ Bell said: “A better-than-expected third-quarter GDP growth figure from the UK could help to ease the pressure on the beleaguered pound, although it is still too early to say Britain is out of the woods, as the nation sits in its post-referendum, pre-Brexit limbo.”

It is the last set of GDP data before next month’s Autumn Statement, the first for new Chancellor Philip Hammond.

GDP growth Q3 2016Source: Office for National Statistics

 

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