UK economy grows at lowest level in 6 months

UK economy grows at lowest level in 6 months

The latest official economic data has shown the UK economy grew by 0.3 per cent in the three months to the end of November, the lowest level for six months.

But the data, released by the Office for National Statistics (ONS) this morning (January 11) also showed the economy appeared to grow much faster in November than in the earlier months of the period, at 0.2 per cent.

Yael Selfin, chief economist at KPMG UK, said: "Figures released today show the UK economy regained momentum in November, with GDP growing by 0.2 per cent after a more muted performance in autumn.

"Services remain the main driver of growth, with strong growth recorded by the wholesale and retail sector as well as hotel and restaurants and information and communication services.

"Manufacturing output contracted for the fifth consecutive month in November, although goods exports recovered, while construction regained momentum and grew by 0.6 per cent in November after flat growth in October. "    

He said these figures contrasted with the overall picture seen on the high-street. "And with Brexit uncertainties likely to continue to weigh on households’ spending and business investment, we expect a weak first quarter of 2019," he added.

The 0.2 per cent growth rate in November was twice the expected level.

By comparison, the latest data for German manufacturing showed a 1.9 per cent drop, and that country also recorded negative GDP growth in the most recent set of data.

Will Hobbs, chief investment officer at Barclays Smart Investor, said: "A range of indicators have been pointing to the UK economy sagging a little more visibly under the weight of Brexit related uncertainty.

"There has been some evidence that UK companies have been building inventories into the end of the year, one assumes in preparation for the potential for hard Brexit.  

"However, overall the UK economic skies continue to darken somewhat in the short run."