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You can find the current article at its original source at https://www.theguardian.com/business/live/2017/oct/25/uk-gdp-britain-growth-slowdown-brexit-pound-ftse-business-live
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| UK GDP: Britain's economy grew by 0.4% as Brexit slowdown continues - business live | UK GDP: Britain's economy grew by 0.4% as Brexit slowdown continues - business live |
| (35 minutes later) | |
| 11.33am BST | |
| 11:33 | |
| Leslie: Slow growth shows importance of Brexit deal | |
| Labour MP Chris Leslie, who supports the Open Britain campaign, says inflation and Brexit uncertainty are holding growth back: | |
| “These figures show the damaging impact Brexit is already having on the economy, with workers and consumers feeling the squeeze in lower wages and higher prices. | |
| Leslie adds that the UK needs to negotiate membership of the Single Market and Customs Union, rather than risk crashing out of Europe without a deal.... | |
| Incidentally, the latest word from parliament is that MPs might not get a vote on Brexit until after the UK has left the European Union! A funny way of taking back control.... | |
| David Davis says parliament may not get vote on final deal until after Brexit happens - https://t.co/b5FW0CmqFj | |
| Updated | |
| at 11.34am BST | |
| 11.19am BST | 11.19am BST |
| 11:19 | 11:19 |
| The pound continues to push higher, now up 0.8 of a cent at $1.322, as the City continues to price in a rate hike next month. | The pound continues to push higher, now up 0.8 of a cent at $1.322, as the City continues to price in a rate hike next month. |
| Big move for the pound off the back of the GDP growth. 1.3230 still the obstacle: pic.twitter.com/Bu3iMfvRh2 | Big move for the pound off the back of the GDP growth. 1.3230 still the obstacle: pic.twitter.com/Bu3iMfvRh2 |
| But...Dr Gordon Fletcher of University of Salford Business School fears that a UK interest rate rise could undermine the recovery. | But...Dr Gordon Fletcher of University of Salford Business School fears that a UK interest rate rise could undermine the recovery. |
| He writes: | He writes: |
| Growth is now weaker compared to the other major European economies and could itself be seen as tangible result of a ‘Brexit effect’. The past decade has also been a time of historical low interest rates and now concern will turn towards the prospect of an imminent rise in this rate. | Growth is now weaker compared to the other major European economies and could itself be seen as tangible result of a ‘Brexit effect’. The past decade has also been a time of historical low interest rates and now concern will turn towards the prospect of an imminent rise in this rate. |
| A rate rise could then be a disincentive in a relatively weak economy to further business growth and expansion. It is a fine balance. | A rate rise could then be a disincentive in a relatively weak economy to further business growth and expansion. It is a fine balance. |
| 11.14am BST | 11.14am BST |
| 11:14 | 11:14 |
| Robert Gordon, CEO of Hitachi Capital UK, is pleased to see that manufacturing output rose by 1% during the quarter. | Robert Gordon, CEO of Hitachi Capital UK, is pleased to see that manufacturing output rose by 1% during the quarter. |
| As the backbone of our economy, the onus is now on the government to ensure that investment continues despite Brexit uncertainty.” | As the backbone of our economy, the onus is now on the government to ensure that investment continues despite Brexit uncertainty.” |
| 11.07am BST | 11.07am BST |
| 11:07 | 11:07 |
| Yael Selfin, chief economist at KPMG, says the UK economy has ‘lost its sparkle’, and put in another ‘lacklustre performance’ in the last quarter: | Yael Selfin, chief economist at KPMG, says the UK economy has ‘lost its sparkle’, and put in another ‘lacklustre performance’ in the last quarter: |
| She fears that growth will remain subdued while Brexit plays out... | She fears that growth will remain subdued while Brexit plays out... |
| There has been a deterioration in economic performance since the start of the year, as inflation has begun to bite and consumers have started to reconsider their priorities. | There has been a deterioration in economic performance since the start of the year, as inflation has begun to bite and consumers have started to reconsider their priorities. |
| This trend is likely to remain for a while, with Brexit related uncertainties looming large for consumers and businesses. Our expectations are therefore for annual GDP growth to fall short of the UK’s potential and reach only around 1.5% in the short term. | This trend is likely to remain for a while, with Brexit related uncertainties looming large for consumers and businesses. Our expectations are therefore for annual GDP growth to fall short of the UK’s potential and reach only around 1.5% in the short term. |
| 11.05am BST | 11.05am BST |
| 11:05 | 11:05 |
| Full story: GDP figures could lead to interest rate hike | Full story: GDP figures could lead to interest rate hike |
| Britain’s first interest rate rise since 2007 could be just round the corner, writes our economics correspondent Richard Partington: | Britain’s first interest rate rise since 2007 could be just round the corner, writes our economics correspondent Richard Partington: |
| British consumers are being put on notice for a rate hike from next week, as official figures show the economy expanding faster than anticipated in the three months to September. | British consumers are being put on notice for a rate hike from next week, as official figures show the economy expanding faster than anticipated in the three months to September. |
| GDP grew by 0.4% in the third quarter of 2017 following expansion of 0.3% in the three months to June, according to the Office for National Statistics. City economists had forecast growth of 0.3%. | GDP grew by 0.4% in the third quarter of 2017 following expansion of 0.3% in the three months to June, according to the Office for National Statistics. City economists had forecast growth of 0.3%. |
| The official figures come as the Bank of England prepares to hike interest rates for the first time in a decade, with the monetary policy committee likely to take them into account ahead of its decision on 2 November. Threadneedle Street has faced a slew of warnings against raising the cost of borrowing, amid growing concerns over the strength of the economy – which could be allayed by the latest data. | The official figures come as the Bank of England prepares to hike interest rates for the first time in a decade, with the monetary policy committee likely to take them into account ahead of its decision on 2 November. Threadneedle Street has faced a slew of warnings against raising the cost of borrowing, amid growing concerns over the strength of the economy – which could be allayed by the latest data. |
| Ruth Gregory, UK economist at the consultancy Capital Economics, said the latest figures “have probably sealed the deal on an interest rate hike next week.” | Ruth Gregory, UK economist at the consultancy Capital Economics, said the latest figures “have probably sealed the deal on an interest rate hike next week.” |
| Here’s the full story: | Here’s the full story: |
| 10.56am BST | 10.56am BST |
| 10:56 | 10:56 |
| You can keep up to speed on all the latest economic and business news with our daily email..... | You can keep up to speed on all the latest economic and business news with our daily email..... |
| 10.48am BST | 10.48am BST |
| 10:48 | 10:48 |
| Mihir Kapadia, CEO of Sun Global Investments, says Britain’s growth rate looks ‘subpar’, despite avoiding the recession that some experts predicted after the EU referendum. | Mihir Kapadia, CEO of Sun Global Investments, says Britain’s growth rate looks ‘subpar’, despite avoiding the recession that some experts predicted after the EU referendum. |
| He adds: | He adds: |
| The third quarter has been particularly difficult for the UK economy, with inflation ringing 3% while wage growth has been subdued. | The third quarter has been particularly difficult for the UK economy, with inflation ringing 3% while wage growth has been subdued. |
| Consumers are facing an increased squeeze in living standards while the city has been brought to its knees by the increased uncertainty over Brexit proceedings.” | Consumers are facing an increased squeeze in living standards while the city has been brought to its knees by the increased uncertainty over Brexit proceedings.” |
| 10.42am BST | 10.42am BST |
| 10:42 | 10:42 |
| Danielle Haralambous of the Economist Intelligence Unit, has tweeted a nice graph showing how Britain’s annual growth rate has slowed (to 1.5% in the last quarter). | Danielle Haralambous of the Economist Intelligence Unit, has tweeted a nice graph showing how Britain’s annual growth rate has slowed (to 1.5% in the last quarter). |
| International context for #UK GDP. Quarterly growth rate may have surprised on the upside, but annual rate is sliding, in contrast to US, EZ pic.twitter.com/phJcNsh5Sw | International context for #UK GDP. Quarterly growth rate may have surprised on the upside, but annual rate is sliding, in contrast to US, EZ pic.twitter.com/phJcNsh5Sw |
| Updated | Updated |
| at 10.44am BST | at 10.44am BST |
| 10.34am BST | 10.34am BST |
| 10:34 | 10:34 |
| John McDonnell MP, Labour’s Shadow Chancellor, says the UK economy is too weak, and needs more government investment - ideally in next month’s Budget. | John McDonnell MP, Labour’s Shadow Chancellor, says the UK economy is too weak, and needs more government investment - ideally in next month’s Budget. |
| Here’s his response to today’s growth figures: | Here’s his response to today’s growth figures: |
| “Today’s GDP figures further confirm the impact that seven wasted years of Tory economic policy has had on working households. | “Today’s GDP figures further confirm the impact that seven wasted years of Tory economic policy has had on working households. |
| “Economic growth for the majority of 2017 has been below what was expected. In recent weeks leading independent forecasters have slashed growth for next year, and the latest economic data shows wages are still set to fall behind prices - squeezing living standards further. | “Economic growth for the majority of 2017 has been below what was expected. In recent weeks leading independent forecasters have slashed growth for next year, and the latest economic data shows wages are still set to fall behind prices - squeezing living standards further. |
| “The UK is not growing as fast as many of our trading partners in the EU or the USA, and it is becoming increasingly clear that this government has to use next month’s Budget for a change of direction. | “The UK is not growing as fast as many of our trading partners in the EU or the USA, and it is becoming increasingly clear that this government has to use next month’s Budget for a change of direction. |
| “The Chancellor cannot keep hiding from the facts, as his approach of carrying on as usual is seriously putting working people’s living standards at risk. | “The Chancellor cannot keep hiding from the facts, as his approach of carrying on as usual is seriously putting working people’s living standards at risk. |
| “Labour has consistently called for increased investment underpinned by our fiscal credibility rule, so that we can prepare our economy for any downturn from the Tories’ chaotic handling of Brexit.” | “Labour has consistently called for increased investment underpinned by our fiscal credibility rule, so that we can prepare our economy for any downturn from the Tories’ chaotic handling of Brexit.” |
| 10.14am BST | 10.14am BST |
| 10:14 | 10:14 |
| Experts: UK still suffering from Brexit | Experts: UK still suffering from Brexit |
| Peter Dixon, economist at Commerzbank, says Britain’s economy is still suffering from the Brexit vote last year, and the slide in the value of the pound. | Peter Dixon, economist at Commerzbank, says Britain’s economy is still suffering from the Brexit vote last year, and the slide in the value of the pound. |
| He argues that the 0.4% growth recorded in the July-September quarter shouldn’t be celebrated. | He argues that the 0.4% growth recorded in the July-September quarter shouldn’t be celebrated. |
| Dixon writes: | Dixon writes: |
| UK GDP growth....was a little bit above what we had expected but still below the rates of growth we enjoyed back in 2016 as service sector growth appears to be running around one or two tenths slower. | UK GDP growth....was a little bit above what we had expected but still below the rates of growth we enjoyed back in 2016 as service sector growth appears to be running around one or two tenths slower. |
| This in turn may be a consequence of the weakness of consumption, triggered by the recent inflation pickup which itself is a consequence of the Brexit-induced collapse in sterling. | This in turn may be a consequence of the weakness of consumption, triggered by the recent inflation pickup which itself is a consequence of the Brexit-induced collapse in sterling. |
| All in all, it appears that the economy is running around 0.5% per year more slowly than prior to the EU referendum. | All in all, it appears that the economy is running around 0.5% per year more slowly than prior to the EU referendum. |
| Professor Costas Milas, of the University of Liverpool’s Management School, agrees that the economic picture isn’t rosy. | Professor Costas Milas, of the University of Liverpool’s Management School, agrees that the economic picture isn’t rosy. |
| Prof Milas: | Prof Milas: |
| Brexit-related economic uncertainty is taking a toll on the economy not only in terms of getting stuck to 1.5% annual growth for 2017 Q3 but also in terms of the “quality” of the reading itself. | Brexit-related economic uncertainty is taking a toll on the economy not only in terms of getting stuck to 1.5% annual growth for 2017 Q3 but also in terms of the “quality” of the reading itself. |
| Indeed, since the Brexit vote, the first reading of ONS has over-estimated annual GDP growth by a notable average of 0.3%. | Indeed, since the Brexit vote, the first reading of ONS has over-estimated annual GDP growth by a notable average of 0.3%. |
| Neil Wilson of ETX Capital says the UK economy is ‘stuck in second gear’, adding. | Neil Wilson of ETX Capital says the UK economy is ‘stuck in second gear’, adding. |
| Year-on-year growth stands at 1.5%, which if it continues would be the weakest expansion since the crisis. The productivity puzzle remains unsolved - GDP per head lagged the headline number and increased by just 0.3%. | Year-on-year growth stands at 1.5%, which if it continues would be the weakest expansion since the crisis. The productivity puzzle remains unsolved - GDP per head lagged the headline number and increased by just 0.3%. |
| Yael Selfin, KPMG’s chief UK economist, warns that the economy isn’t growing fast enough to justify tax cuts in next month’s budget: | Yael Selfin, KPMG’s chief UK economist, warns that the economy isn’t growing fast enough to justify tax cuts in next month’s budget: |
| UK Q3 GDP growth up marginally to 0.4% signals continued lacklustre performance. No room for meaningful giveaways in the Budget next month. | UK Q3 GDP growth up marginally to 0.4% signals continued lacklustre performance. No room for meaningful giveaways in the Budget next month. |
| 10.07am BST | 10.07am BST |
| 10:07 | 10:07 |
| Here’s some detail of the UK GDP report, showing that computer programming and the UK car sector grew strongly over the summer. | Here’s some detail of the UK GDP report, showing that computer programming and the UK car sector grew strongly over the summer. |
| The strong performance by the motor industry is a surprise, as the UK’s largest car dealer, Pendragon, issued a profit warning on Monday.... | The strong performance by the motor industry is a surprise, as the UK’s largest car dealer, Pendragon, issued a profit warning on Monday.... |
| Here’s some really granular detail: | Here’s some really granular detail: |
| Here's the 10 fastest growing sectors of the UK economy in Q3. Apparently we broke a lot of things... pic.twitter.com/efFoIzyIgU | Here's the 10 fastest growing sectors of the UK economy in Q3. Apparently we broke a lot of things... pic.twitter.com/efFoIzyIgU |
| 10.01am BST | 10.01am BST |
| 10:01 | 10:01 |
| Hammond: We need to boost productivity | Hammond: We need to boost productivity |
| The Treasury have released a comment from Chancellor Philip Hammond, although it doesn’t really address the GDP figures directly.... | The Treasury have released a comment from Chancellor Philip Hammond, although it doesn’t really address the GDP figures directly.... |
| “We have a successful and resilient economy which is supporting a record number of people in employment. My focus now, and going into the Budget, is on boosting productivity so that we can deliver higher-wage jobs and a better standard of living for people across the country. | “We have a successful and resilient economy which is supporting a record number of people in employment. My focus now, and going into the Budget, is on boosting productivity so that we can deliver higher-wage jobs and a better standard of living for people across the country. |
| “That is why I am visiting the Francis Crick Institute, where they are using cutting-edge research to generate real-life health improvements. The UK has world-leading expertise in life sciences – an industry that employs hundreds of thousands of people – and it is through supporting growth in these cutting-edge industries that we will build a competitive economy that works for everyone.” | “That is why I am visiting the Francis Crick Institute, where they are using cutting-edge research to generate real-life health improvements. The UK has world-leading expertise in life sciences – an industry that employs hundreds of thousands of people – and it is through supporting growth in these cutting-edge industries that we will build a competitive economy that works for everyone.” |
| Updated | Updated |
| at 10.04am BST | at 10.04am BST |
| 9.58am BST | 9.58am BST |
| 09:58 | 09:58 |
| Several analysts are pointing out that Britain’s growth rate remains unimpressive, despite rising in the last quarter: | Several analysts are pointing out that Britain’s growth rate remains unimpressive, despite rising in the last quarter: |
| Reaction fr @XTBUK: Compared to majority of G20 countries UK growth remains tepid #ukgdp | Reaction fr @XTBUK: Compared to majority of G20 countries UK growth remains tepid #ukgdp |
| Britain's growth is still weaker than it was in 2016, despite boost from latest GDP data https://t.co/8w2HXaprVE pic.twitter.com/3h60cZSfzz | Britain's growth is still weaker than it was in 2016, despite boost from latest GDP data https://t.co/8w2HXaprVE pic.twitter.com/3h60cZSfzz |
| GDP per person up 0.3% year-on-year in the third quarter. That's double the rates recorded in Q1 and Q2, but still below historical norms pic.twitter.com/YzCXgOiGKc | GDP per person up 0.3% year-on-year in the third quarter. That's double the rates recorded in Q1 and Q2, but still below historical norms pic.twitter.com/YzCXgOiGKc |
| 9.49am BST | 9.49am BST |
| 09:49 | 09:49 |
| Geraint Johnes, Professor of Economics at Lancaster University Management School, says Britain is only achieving ‘stable but slow growth’: | Geraint Johnes, Professor of Economics at Lancaster University Management School, says Britain is only achieving ‘stable but slow growth’: |
| “The headline growth of 0.4% over the third quarter represents a slight increase over the second quarter figure. | “The headline growth of 0.4% over the third quarter represents a slight increase over the second quarter figure. |
| “Over the year, growth is just 1.5%, and the quarterly figure suggests little momentum going forward. | “Over the year, growth is just 1.5%, and the quarterly figure suggests little momentum going forward. |
| 9.49am BST | 9.49am BST |
| 09:49 | 09:49 |
| Pound rises after GDP data | Pound rises after GDP data |
| Sterling has risen on the back of today’s growth report, up 0.25% against the US dollar to $1.317. | Sterling has risen on the back of today’s growth report, up 0.25% against the US dollar to $1.317. |
| City traders are concluding that the pick-up in growth raises the chances of a UK interest rate rise next month. | City traders are concluding that the pick-up in growth raises the chances of a UK interest rate rise next month. |
| Pound pops up to $1.3172 after U.K. #GDP rises 0.4% in Q3 vs. 0.3% estimate $gbpusd pic.twitter.com/X49ueCgct9 | Pound pops up to $1.3172 after U.K. #GDP rises 0.4% in Q3 vs. 0.3% estimate $gbpusd pic.twitter.com/X49ueCgct9 |
| 9.44am BST | 9.44am BST |
| 09:44 | 09:44 |
| This pick-up in UK growth means that Britain still hasn’t suffered the recession that some experts predicted if the country voted to leave the EU. | This pick-up in UK growth means that Britain still hasn’t suffered the recession that some experts predicted if the country voted to leave the EU. |
| However, 0.4% is a still below the UK’s long-term growth rate. As this chart shows, 2017 could be the weakest year for the economy since the financial crisis (the 2012 figures are distorted by the London Olympics). | However, 0.4% is a still below the UK’s long-term growth rate. As this chart shows, 2017 could be the weakest year for the economy since the financial crisis (the 2012 figures are distorted by the London Olympics). |
| 9.39am BST | 9.39am BST |
| 09:39 | 09:39 |
| If you adjust for population changes, UK GDP rose by 0.3% during the last quarter. | If you adjust for population changes, UK GDP rose by 0.3% during the last quarter. |