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Britain's growth & # 39; slowest in almost a decade & # 39;



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The UK economy has grown at the slowest rate of almost a decade, according to official figures.

Annual growth in the three months to the end of September slowed to 1

% from 1.3% in the second quarter, the Office for National Statistics said.

A spokesman for the ONS said: "Looking at the picture over the past year slowed growth to its lowest rate in almost a decade."

But the economy avoided a recession by rising 0.3% in the third quarter.

The economy had shrunk in the second quarter and two quarters of contraction would have signaled a recession.

What happened during the three-month period?

Although the economy expanded by 0.3% in the third quarter, it was not as fast as 0.4% projected by economists, including the Bank of England.

A statistician at the ONS said that GDP grew "regularly" in the third quarter. It was largely as a result of a "strong July".

"The underlying trade deficit was reduced, mainly due to increasing exports of both goods and services."

What happened in September?

In September, GDP fell by 0.1%, as expected.

However, the ONS revised down the contraction in August to 0.2% from 0.1%.

It was 0.3% growth in July that drove the economy throughout the third quarter.

John Hawksworth, chief economist at PwC, said: "The fact that growth was positive in the third quarter was largely due to a strong July.

" Production then declined in August and September, pointing to a lack of momentum in the economy entering the fourth quarter. "

How did the various parts of the economy perform?

The statistician at the ONS said:" The services again led the plant, with the construction also good.

"Production failed to grow, as declines in many industries were offset by car production that rebounded after closures in April."

ONS said that the construction sector showed its first positive growth in a rolling three-month period since May.

Production was flat in the three months to September and has not shown growth over a rolling three-month period since April.

Suren Thiru, Head of Economics at the British Chambers of Commerce (BCC), said: "The dominant services sector was the main driver of GDP growth in the quarter, while the industrial production and construction sector contributed little to the overall UK GDP. growth. "

What does this tell us about the economy?

Ruth Gregory, senior British economist at Capital Economics said that although the economy avoided a recession in the third quarter, the economy was "quite soft".

"The GDP figures suggest that the economy failed to regain much momentum after the contraction in the second quarter." [ 1 9659017] Tej Parikh, chief economist at the Institute of Director, said that "a return to growth is welcome news, but narrowly avoiding a recession is nothing to celebrate."

"The UK economy has been in stop-start mode all year, with growth punctuated by the various Brexit deadlines," he added.

Gregory added: "While the election is less than five weeks away, this is clearly not the good news the government may have hoped for."

Was Brexit storage important?

The economy had unexpectedly fallen by 0.2% in the second quarter – the period March to June – when Brexit stocks were liquidated after the first Brexit date on March 29.

Samuel Tombs, an economist at Pantheon Macroeconomics, said that a "renewed inventory strength" failed to materialize in the third quarter.

"It is possible that storage occurred to a greater extent at the beginning of the fourth quarter," he said, adding growth in the fourth quarter may not be depressed to the extent he expected.

But Mr Parikh said that "the last quarter of 2019 may become weaker as stocks continue to decline."

What do politicians say?

The chancellor, Sajid Javid, said the numbers were "another welcome sign that the basic factors of the UK economy are strong. Under the Conservatives we have seen nine consecutive years of growth."

He added: "What it also shows is the real risk of growth in our e conomy is Corbyn & # 39; s Labor. If they get right, two referendums in 2020, an eye on water use and loans and debt, will that kind of economic vandalism stops growth in this country. "

But John McDonnell, the shadow chancellor, said:" The fact that the government will celebrate 0.1% growth over the past six months is a sign of how low hopes and expectations are they have for our economy. "

Ed Davey, Left Democrat, said, "The economy of the Tories is anemic."

As much as it would be a relief to avoid a formal recession, the picture is very slow, in line with what has called a "slow puncture" economy.

Growth of 0.3% between July and September is clearly preferable to a further quarterly contraction, but still slow to normal historical standards.

Compared to the third quarter of this year with the same period last year, growth of only 1% is the slowest since the wake of the financial crisis. These are the weakest two quarters since the financial crisis.

The background is a slower European and world economic tension from trade wars.

But years of damaged business investment, following the Brexit referendum, are gaining emphasis on growth.

The last figures in the month of September showed a contraction of 0.1%. Data has been unstable this year, with shutdowns in the automotive industry and two bouts of ultimately unnecessary Brexit inventory without agreement.

So the recession is avoided, but this is not the "reset" as some have promised.


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