UK GDP grows 3% year on year

UK GDP increased by 0.7 per cent in the third quarter of 2014, down on the last quarter’s figure of 0.9 per cent, but up 3 per cent on the same period last year, the Office for National Statistics has estimated.

The latest figures from the ONS showed increases in all four main aggregates: output was up by 0.7 per cent in services, 0.5 per cent in production, 0.8 per cent in construction and 0.3 per cent in agriculture.

Neil Williams, chief economist at Hermes, stated that today’s data nudges the UK further down the recovery road, but there’s still further to go.

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“Seven years after the first traces of crisis, and we have only a three-speed recovery. In the fast lane are the US, Canada, NZ, and Australia. In the middle, the UK’s GDP is now about 4 per cent higher than pre-crisis.”

Helal Miah, investment research analyst at The Share Centre, said the figures were in line with expectations, meaning the market reaction has been muted.

“The market will point towards a number of global events as a cause for a moderation of the growth rate, especially the worsening conditions in Europe and the spill over effects to the rest of the world.

“However, the figures still confirm that the UK is the most robust of the major developed economies.

“We believe that the recovery has more to go, albeit at slower rates than previously expected, and that UK stocks remain the best source for good returns for investors. Specifically, we believe the more UK focussed small and mid-cap stocks should outperform the internationally exposed large caps.”