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| UK construction output drops in August | UK construction output drops in August |
| (about 1 hour later) | |
| Construction output fell 4.3% in August, its sharpest drop since late 2012, the Office for National Statistics (ONS) has said. | Construction output fell 4.3% in August, its sharpest drop since late 2012, the Office for National Statistics (ONS) has said. |
| In the three months to August, output fell by 0.8%, the biggest such decline since March 2013. | In the three months to August, output fell by 0.8%, the biggest such decline since March 2013. |
| Meanwhile, the UK trade deficit was £3.3bn in August, a narrowing of £1.2bn from July, it said. | Meanwhile, the UK trade deficit was £3.3bn in August, a narrowing of £1.2bn from July, it said. |
| But the deficit was larger than expected and is set to weigh on growth, the ONS added. | But the deficit was larger than expected and is set to weigh on growth, the ONS added. |
| An ONS official said the weak figures for construction in August may have been linked to wet weather during the month. | An ONS official said the weak figures for construction in August may have been linked to wet weather during the month. |
| Housebuilding fell by 3% from July and output in other parts of the sector also contracted for the first across-the-board decline since 2010. | Housebuilding fell by 3% from July and output in other parts of the sector also contracted for the first across-the-board decline since 2010. |
| The trade figures showed the UK's deficit in its trade in goods narrowed to £11.1bn in August compared with £12.2bn in July, although some analysts had expected it to shrink further. | The trade figures showed the UK's deficit in its trade in goods narrowed to £11.1bn in August compared with £12.2bn in July, although some analysts had expected it to shrink further. |
| The deficit of £11.1bn on goods was partly offset by a £7.9bn surplus on services. Exports increased by £0.8bn, boosted by cars. | The deficit of £11.1bn on goods was partly offset by a £7.9bn surplus on services. Exports increased by £0.8bn, boosted by cars. |
| 'Double blow' | |
| The combined goods deficit for July and August is already twice that of the previous quarter, and is likely to have a negative effect on overall GDP growth. | |
| The UK's economy grew by 0.7% in the second quarter of the year, but Howard Archer of IHS Global Insight said overall growth prospects for the third quarter had received a "double blow" from the construction and trade data, which was "seriously bad news overall". | |
| "Overall, the data reinforce our belief that GDP growth is likely be no better than 0.5% quarter-on-quarter in the third quarter, and there is now a significant risk that it could have been weaker still." | |
| David Kern, chief economist of the British Chambers of Commerce, said: "The large trade deficit remains a major national problem. Greater efforts are needed to support our exporters and to secure a long-term improvement in our trading position." |