This article is from the source 'guardian' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.

You can find the current article at its original source at https://www.theguardian.com/business/live/2016/jul/27/uk-gdp-economy-growth-brexit-referendum-pound-markets-live

The article has changed 18 times. There is an RSS feed of changes available.

Version 2 Version 3
UK GDP figures show how economy was growing before Brexit vote – business live UK economic growth accelerated to 0.6% before Brexit vote – live updates
(35 minutes later)
10.01am BST
10:01
A word of caution....
Today’s GDP report is mainly based on data from April and May, as it’s too early to have a full picture of the economy in June.
So if Britain did suffer a dose of Brexit angst last month, it won’t appear in today’s data - we’ll have to wait for the second estimate of GDP in August.
Simon French, chief economist of Panmure Gordon, flags up that April was a particularly strong month:
0.6% QoQ growth in Q2 UK GDP. April data across all sectors looks distorted due to March Easter holidays pic.twitter.com/1my3VoqSJz
9.56am BST
09:56
ONS: Little sign of Brexit fears
Britain’s carmakers and pharmaceutical firms helped to drive the economy forwards, according to Joe Grice, the Office for National Statistics’ top economist.
The ONS also found little sign that the EU referendum on June 23rd had hurt the economy during the last quarter.
Commenting on today’s Q2 GDP figures, ONS Chief Economist Joe Grice said: pic.twitter.com/74zR4EtvPR
9.51am BST
09:51
Despite the surge in industrial output last quarter, the sector is *still* smaller than before the financial crisis back in 2008.
Only the services sector (which makes up 70% of the economy) is larger:
Updated
at 9.54am BST
9.43am BST
09:43
Britain’s economy is now 7.7% higher than the pre-economic downturn peak, in the first quarter of 2008.
The 0.6% growth recorded in Q2 means the UK has been growing for the last 14 quarters:
9.39am BST
09:39
Britain’s new Chancellor of the Exchequer, Philip Hammond, has welcomed the news that the UK growth rate has jumped to 0.6%.
He says:
“Today’s GDP figures show that the fundamentals of the British economy are strong. In the second quarter of this year our economy grew by 0.6 per cent – faster than was expected. Indeed we saw the strongest quarterly rise in production for nearly twenty years, so it is clear we enter our negotiations to leave the EU from a position of economic strength.
“Those negotiations will signal the beginning of a period of adjustment, but I am confident we have the tools to manage the challenges ahead, and along with the Bank of England, this government will take whatever action is necessary to support our economy and maintain business and consumer confidence.
9.37am BST
09:37
UK industrial output leaps, but services slow
Britain’s manufacturing sector has a very good quarter, according to today’s GDP report.
UK industrial output jumped by 2.1% during the April-June period, the strongest quarterly growth since the third quarter of 1999.
UK GDP +0.6% in Q2 vs expected +0.4%, driven by strongest industrial production growth since 1999. Annual GDP +2.2% vs expected 2.0%.
However, the service sector slowed to 0.5% growth, down from 0.6% in Q1.
And construction output shrank by 0.4%.
9.35am BST
09:35
On an annual basis, the UK economy grew by 2.2% over the last 12 months - up from 2.0% three months ago.
9.30am BST
09:30
UK GROWTH FIGURES RELEASED
Here we go: The UK economy expanded by 0.6% in the last three months, up from 0.4% in the January-March quarter.
That’s faster than expected. It suggests that the UK economy was in fairly robust shape before June’s EU referendum.
Lots more detail and reaction to follow!
9.25am BST9.25am BST
09:2509:25
UK Q2 GDP out in 8 mins. Market consensus is for +0.5% (from 0.4%). Did activity actually drop off in run up to #Brexit ? #FX #UKdataUK Q2 GDP out in 8 mins. Market consensus is for +0.5% (from 0.4%). Did activity actually drop off in run up to #Brexit ? #FX #UKdata
9.18am BST9.18am BST
09:1809:18
Tension is mounting in the City, as traders wait for the UK GDP data to drop in 10 minutes.Tension is mounting in the City, as traders wait for the UK GDP data to drop in 10 minutes.
The pound is weakening a little, down 0.1% against the US dollar at $1.3111.The pound is weakening a little, down 0.1% against the US dollar at $1.3111.
Ana Thaker, market economist at PhillipCapital, explains why investors are anxious:Ana Thaker, market economist at PhillipCapital, explains why investors are anxious:
A positive figure will add to optimism that the UK economy was robust going into the vote and therefore may weather the repercussions better than previously forecasted.A positive figure will add to optimism that the UK economy was robust going into the vote and therefore may weather the repercussions better than previously forecasted.
However, poor figures will be a blow to already fragile and worried markets, with expectations that the Brexit decision will only exacerbate problems in an already weak economy and could see weakness in Sterling as markets contemplate the prospect of an easing package from the Bank of England.However, poor figures will be a blow to already fragile and worried markets, with expectations that the Brexit decision will only exacerbate problems in an already weak economy and could see weakness in Sterling as markets contemplate the prospect of an easing package from the Bank of England.
9.05am BST9.05am BST
09:0509:05
London’s stock market has hit a new 11-month high this morning.London’s stock market has hit a new 11-month high this morning.
The FTSE 100 has risen by 20 points to 6744, a level last seen in August 2015.The FTSE 100 has risen by 20 points to 6744, a level last seen in August 2015.
#FTSE100 hits highest level since August 6 2015; now up 21.86% since February low. https://t.co/0DFTUwAHIs pic.twitter.com/iuVE3tcUmn#FTSE100 hits highest level since August 6 2015; now up 21.86% since February low. https://t.co/0DFTUwAHIs pic.twitter.com/iuVE3tcUmn
Shares are rallying worldwide, after Japan’s prime ministers promised a stimulus package, worth around £200bn:Shares are rallying worldwide, after Japan’s prime ministers promised a stimulus package, worth around £200bn:
Related: Japan to unveil huge $266bn economic stimulus, say reportsRelated: Japan to unveil huge $266bn economic stimulus, say reports
UpdatedUpdated
at 9.27am BSTat 9.27am BST
8.44am BST8.44am BST
08:4408:44
UK companies upbeat about Brexit impactUK companies upbeat about Brexit impact
Encouragingly, several UK companies have told shareholders this morning that they’re not suffering any serious harm from the Brexit vote.Encouragingly, several UK companies have told shareholders this morning that they’re not suffering any serious harm from the Brexit vote.
Yet, anyway.Yet, anyway.
Here’s Housebuilder Taylor Wimpey:Here’s Housebuilder Taylor Wimpey:
One month on from the EU Referendum, current trading remains in line with normal seasonal patterns. Customer interest continues to be high, with a good level of visitors both to our developments and to our website.One month on from the EU Referendum, current trading remains in line with normal seasonal patterns. Customer interest continues to be high, with a good level of visitors both to our developments and to our website.
Challenger bank Metro says:Challenger bank Metro says:
“Metro Bank is in a strong position to deal with any post European Referendum uncertainty. Since the Referendum vote we have seen no change in customer behaviour or impact on business flows.”“Metro Bank is in a strong position to deal with any post European Referendum uncertainty. Since the Referendum vote we have seen no change in customer behaviour or impact on business flows.”
Fund manager Jupiter is also upbeat:Fund manager Jupiter is also upbeat:
Jupiter has continued to deliver strong investment outperformance after all fees in the first half of the year. Net flows were positive despite the market backdrop and we made further targeted investments to support our strategy of diversification by product, client type and geography which continues to deliver on behalf of our clients and shareholders.Jupiter has continued to deliver strong investment outperformance after all fees in the first half of the year. Net flows were positive despite the market backdrop and we made further targeted investments to support our strategy of diversification by product, client type and geography which continues to deliver on behalf of our clients and shareholders.
Since the end of June, we have continued to see net flows into our products.Since the end of June, we have continued to see net flows into our products.
It’s early days, of course - Britain hasn’t even triggered Article 50 to begin the formal exit from the EU.It’s early days, of course - Britain hasn’t even triggered Article 50 to begin the formal exit from the EU.
UpdatedUpdated
at 8.45am BSTat 8.45am BST
8.34am BST8.34am BST
08:3408:34
Today’s second-quarter growth figures could be a “last hurrah” before the Brexit vote plunges the UK into recession early next year.Today’s second-quarter growth figures could be a “last hurrah” before the Brexit vote plunges the UK into recession early next year.
That’s according to Bloomberg’s Jill Ward, who flags up that economists expect GDP to shrink slightly over the next six months:.That’s according to Bloomberg’s Jill Ward, who flags up that economists expect GDP to shrink slightly over the next six months:.
So, even if the growth rate does rise to 0.5%, we should still brace for trouble ahead:So, even if the growth rate does rise to 0.5%, we should still brace for trouble ahead:
Samuel Tombs, an economist at Pantheon Macroeconomics, told them:Samuel Tombs, an economist at Pantheon Macroeconomics, told them:
“The economy had done quite well in the run-up to the referendum, but that can turn pretty quickly.“The economy had done quite well in the run-up to the referendum, but that can turn pretty quickly.
“We’ve already seen consumer confidence fall very sharply and all of the survey data has just collapsed over the last month.”“We’ve already seen consumer confidence fall very sharply and all of the survey data has just collapsed over the last month.”
More here:More here:
British Economy’s Last Hurrah Awaited Before Brexit Growth ShockBritish Economy’s Last Hurrah Awaited Before Brexit Growth Shock
And here’s what a ‘last hurrah’ looks like in practice #ouchAnd here’s what a ‘last hurrah’ looks like in practice #ouch
In other words, this is a fairly accurate description of the U.K. economy https://t.co/RAnIWFqcXb pic.twitter.com/VCGO5FRP8iIn other words, this is a fairly accurate description of the U.K. economy https://t.co/RAnIWFqcXb pic.twitter.com/VCGO5FRP8i
UpdatedUpdated
at 8.45am BSTat 8.45am BST
8.25am BST8.25am BST
08:2508:25
Critics often argue that GDP is a poor measure of the health of an economy.Critics often argue that GDP is a poor measure of the health of an economy.
For example, it doesn’t distinguish between valuable and harmful economic output, nor does it include voluntary work or unpaid activity. It also doesn’t measure economic inequality, or living standards.For example, it doesn’t distinguish between valuable and harmful economic output, nor does it include voluntary work or unpaid activity. It also doesn’t measure economic inequality, or living standards.
And we have a perfect example of that today; a survey showing that UK real wages (earnings adjusted for inflation) have shrunk by 10% since the 2007 financial crisis.And we have a perfect example of that today; a survey showing that UK real wages (earnings adjusted for inflation) have shrunk by 10% since the 2007 financial crisis.
That dire performance is only matched by Greece, and shows why many people have felt isolated from the recovery since the crisis.That dire performance is only matched by Greece, and shows why many people have felt isolated from the recovery since the crisis.
Related: UK joins Greece at bottom of wage growth leagueRelated: UK joins Greece at bottom of wage growth league
Frances O’Grady of the TUC (which prepared the report) says it shows the economy is still too fragile:Frances O’Grady of the TUC (which prepared the report) says it shows the economy is still too fragile:
“Wages fell off the cliff after the financial crisis, and have barely begun to recover,.“Wages fell off the cliff after the financial crisis, and have barely begun to recover,.
People cannot afford another hit to their pay packets. Working people must not foot the bill for a Brexit downturn in the way they did for the bankers’ crash.”People cannot afford another hit to their pay packets. Working people must not foot the bill for a Brexit downturn in the way they did for the bankers’ crash.”
8.15am BST8.15am BST
08:1508:15
Government cheers Glaxo's £275m investment pushGovernment cheers Glaxo's £275m investment push
Phamaceuticals firm GlaxoSmithKline has given the British economy a boost, by announcing a £275m investment programme to expand its UK manufacturing sites.Phamaceuticals firm GlaxoSmithKline has given the British economy a boost, by announcing a £275m investment programme to expand its UK manufacturing sites.
GSK swept aside worries about the Brexit vote, declaring that it was driven to invest the money by the UK’s “skilled workforce and competitive tax system”.GSK swept aside worries about the Brexit vote, declaring that it was driven to invest the money by the UK’s “skilled workforce and competitive tax system”.
The money will be spent across three GSK sites: Barnard Castle in County Durham, Montrose in Angus, and Ware in Hertfordshire.The money will be spent across three GSK sites: Barnard Castle in County Durham, Montrose in Angus, and Ware in Hertfordshire.
Understandably, the UK government has hailed the news - as a sign that Britain is still open for business despite voting to leave the EU.Understandably, the UK government has hailed the news - as a sign that Britain is still open for business despite voting to leave the EU.
Business and Energy Secretary, Greg Clark argues:Business and Energy Secretary, Greg Clark argues:
“An investment of this scale is a clear vote of confidence in Britain and underlines our position as a global business leader.“An investment of this scale is a clear vote of confidence in Britain and underlines our position as a global business leader.
GSK’s recognition of our skilled workforce, world leading scientific capabilities and competitive tax environment is further proof that there really is no place better in Europe to grow a business.”GSK’s recognition of our skilled workforce, world leading scientific capabilities and competitive tax environment is further proof that there really is no place better in Europe to grow a business.”
7.52am BST7.52am BST
07:5207:52
The Agenda: UK growth figures due todayThe Agenda: UK growth figures due today
Good morning.Good morning.
Britain’s economy is centre-stage today, as we await the official UK GDP figures for the second quarter of this year.Britain’s economy is centre-stage today, as we await the official UK GDP figures for the second quarter of this year.
That report, due at 9.30am sharp, will show how well the British economy performed in the second quarter of this year.That report, due at 9.30am sharp, will show how well the British economy performed in the second quarter of this year.
The City consensus is that the economy grew by 0.4% between April and June, matching the fairly modest growth recorded in January to March.The City consensus is that the economy grew by 0.4% between April and June, matching the fairly modest growth recorded in January to March.
But some fear that the growth rate may have slowed, perhaps to 0.3%.But some fear that the growth rate may have slowed, perhaps to 0.3%.
Today’s report is particularly important as it covered the period running up to the June 23 referendum on Britain’s membership of the EU. It should show whether the UK economy was in decent shape as the nation headed to the polling booths, or already weakening.Today’s report is particularly important as it covered the period running up to the June 23 referendum on Britain’s membership of the EU. It should show whether the UK economy was in decent shape as the nation headed to the polling booths, or already weakening.
Laith Khalaf, senior analyst at Hargreaves Lansdown, explains why the GDP report matters:Laith Khalaf, senior analyst at Hargreaves Lansdown, explains why the GDP report matters:
“It will tell us if the referendum gave the UK economy the jitters in the lead up to the vote.“It will tell us if the referendum gave the UK economy the jitters in the lead up to the vote.
“There are several indicators which have pointed to a slowdown in economic activity as the referendum approached.”“There are several indicators which have pointed to a slowdown in economic activity as the referendum approached.”
The report will also show how Britain’s manufacturing, services, construction and agriculture all performed during the quarter.The report will also show how Britain’s manufacturing, services, construction and agriculture all performed during the quarter.
As this chart shows, Services has provided the bulk of the growth since the financial crisis - making it more dominant than ever.As this chart shows, Services has provided the bulk of the growth since the financial crisis - making it more dominant than ever.
It’s also a busy morning for UK financial results, with housebuilder Taylor Wimpey, broadcaster ITV, challenger banks Shawbrook and Metro Bank all reporting to the City. They’ll doubtless be talking Brexit today.It’s also a busy morning for UK financial results, with housebuilder Taylor Wimpey, broadcaster ITV, challenger banks Shawbrook and Metro Bank all reporting to the City. They’ll doubtless be talking Brexit today.
UpdatedUpdated
at 8.25am BSTat 8.25am BST