Yael Selfin, Chief Economist at KPMG UK, comments on today’s Q3 GDP data
“Today’s GDP data shows the UK economy continued to regain momentum in the third quarter, with GDP rising by 0.6%, thanks to relatively strong consumer spending and a rebound in overall investment and exports growth. However, business investment contracted by 1.2%, and an historically erratic exports performance means this quarter surge is unlikely to last.
“The recovery in manufacturing coincided with the lift in exports but the latest PMI survey for manufacturing points at a slower outlook for the coming months. Construction also recovered strongly while surveys are pointing at a potentially longer lasting upturn. The pace of services growth was slightly slower with the exception of a pick-up in financial services this quarter, with expectations of a continued trend growth over the short-term.
“The upward momentum we have seen this quarter is unlikely to last. The outlook for the rest of the year is for a slightly weaker growth in the final quarter, as uncertainty around Brexit puts downward pressure on investment and relatively weak households’ finances rein in consumer spending. Our forecasts therefore remain for the UK economy to grow by 1.3% this year and by 1.6% in 2019.”
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Notes to Editors:
KPMG LLP, a UK limited liability partnership, operates from 22 offices across the UK with approximately 14,500 partners and staff. The UK firm recorded a revenue of £2.2 billion in the year ended 30 September 2017. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. It operates in 152 countries and has 189,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. Each KPMG firm is a legally distinct and separate entity and describes itself as such.