0.8% GDP growth in Q3

THE economy expanded at its fastest pace in three years as provisional third quarter GDP figures showed growth of 0.8% for the three months to end of September.

The figures follow a raft of upbeat surveys – such as house prices and retail sales, suggesting the economy is moving forward with renewed impetus, the previous quarter saw 0.7% growth.

The Office for National Statistics said the service sector – which accounts for around three-quarters of the economy- rose 0.7%. Construction saw healthy growth of 2.5%, but is still some 12% below its pre-recession peak.

ONS chief economist Joe Grice says that third quarter GDP was depressed by a fall in oil and gas output. Without that fall, GDP would have grown by 1%, he said.  The July heatwave hit oil and gas production which was down 6.8% during the quarter.

Reacting to the figures on Twitter,  Chancellor George Osborne, who is meeting business leaders in Cheshire later said: “This shows that Britain’s hard work is paying off and the country is on the path to prosperity.”

Darrell Matthews, North West director at EEF, the manufacturers’ organisation, welcomed the data too: “Manufacturing also now seems to have some get up and go with the recent expansion the fastest since 2010 Q3, and is bang in line with all the survey evidence we have seen in recent months.

“This is particularly encouraging following the on-off recovery over the past few years and suggests that the monthly contraction in industrial output in August was fully reversed in September.”