Yael Selfin, Chief Economist at KPMG in the UK, comments on today’s GDP Q1 data
Yael Selfin, Chief Economist at KPMG in the UK, comments on today’s GDP Q1 data:
“Disappointing GDP growth of only 0.1% in the first quarter of 2018 can only be partially attributed to the unseasonably cold weather in February and March, according to today’s figures from the ONS. Snow contributed to the 3.3% fall in construction output and also saw retail sales contract in the first quarter, however that was partially offset by an increase in energy production as a result of the lower temperatures. Architectural and engineering activities were relatively strong, pointing at a potential pick up in construction activity later this year.
“Economic growth was driven by business services and the financial sector in Q1, while pressure on households’ finances was evident with consumer facing services such as retail, restaurants and leisure activities continuing to slow down. A fall in manufacturing growth was disappointing given Sterling’s relative weakness, which should have given exports more support.
“With the data today pointing at a potentially more significant moderation in growth than could be attributed to the unseasonably bad weather in the first quarter this year, the MPC may be less unanimous in its decision on interest rates on the 10th May.”
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