This note provides some wider economic analysis to support the Statistical Bulletin relating to the latest GDP release and other major economic releases during the latest month. By drawing on the wider array of economic releases surrounding the GDP release, for example the labour market, trade, retail sales and inflation releases, this note attempts to provide a more comprehensive picture of how the economy has performed in the latest quarter and, where relevant, the latest month. Key points• The latest month's figures fit the emerging picture of a slowing economy, with little respite from immediate inflationary pressures.• GDP growth in the second quarter was 0.1 per cent, revised down from 0.2 per cent. Growth in the first quarter is also slower than previously estimated. As a result, the level of GDP in the second quarter of 2011 is broadly unchanged from its level three quarters earlier.• In the second quarter, growth in the services sector was weaker than previously estimated, offset by markedly stronger growth in the construction sector and a smaller contraction in the production sector.
This note provides some wider economic analysis to support the Statistical Bulletin relating to the latest GDP release and other major economic releases during the latest month. By drawing on the wider array of economic releases surrounding the GDP release, for example the labour market, trade, retail sales and inflation releases, this note attempts to provide a more comprehensive picture of how the economy has performed in the latest quarter and, where relevant, the latest month. Summary • The latest month's economic releases present a picture of continuing weakness in economic growth, with no immediate relief from current high rates of inflation. • GDP is estimated to have grown by 0.5 per cent in the third quarter of 2011. GDP has increased by 0.5 per cent over the latest year, a significant slowdown from the 2.6 per cent growth in the preceding twelve months. • Output of the production sector has weakened during much of 2011, a reversal of the significant growth seen during the second half of 2010, with negative year-on-year growth in five of the six months between March and August. Manufacturing output fared better, but has nevertheless weakened slightly in the last few months. • Services output is estimated to have risen by 0.7 per cent between the second and third quarters of 2011, and is 1.2 per cent higher than a year earlier. Construction output fell between the two latest quarters, and output was down 4 per cent in the year to August. • Real household disposable income growth has been weak in 2010 and into 2011, but ticked up in the second quarter to 1.2 per cent. The savings ratio had been moderating during 2009 and 2010 but picked up in the second quarter to 7.4 per cent. • The labour market weakened in the June-August period compared with the previous three months. The level of employment fell by 178,000, mainly driven by fewer people in part-time employment, while the rate of unemployment rose from 7.7 per cent to 8.1 per cent, a rate not seen since mid-1996. Younger age groups accounted for the bulk of the latest rise in unemployment. • The trade deficit fell from £8,2 billion to 7.8 billion in August as underlying export volume growth exceeded that of imports. Excluding oil and erratic items, export and import volumes have both returned in August towards levels seen in the first quarter of 2011 when net overseas trade made a positive contribution to GDP growth.
This note provides some wider economic analysis to support the Statistical Bulletins relating to the latest GDP release and other major economic releases during the latest month. By drawing on the wider array of economic releases surrounding the GDP release, for example the labour market, trade, retail sales and inflation releases, this note attempts to provide a more comprehensive picture of how the economy has performed in the latest quarter and, where relevant, the latest month.
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