BRITAIN HITS — UK GDP growth in-line at 0.5%
REUTERS/Fabrizio BenschChancellor George Osborne.
The UK's fourth quarter GDP growth just came in at 0.5% — in line with forecasts.
Economists forecasted quarter-on-quarter growth of 0.5%, up from 0.4% in the third quarter. The 0.4% figure was a downward revision from an earlier 0.5% estimate and even that 0.5% figure was a big miss to forecasts.
The mild pick up is will be welcomed by Chancellor George Osborne.
Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said the weaker than expected third quarter GDP reading could be "the start of a pronounced slowdown." While today's figure is by no means a full rebuttal, it shows the third quarter slump could just be a blip that is reversing.
But disappointingly for Osborne, all the fourth quarter growth came from the service sector, as the chart below shows. Since coming to power in 2010, Osborne has been trying to "rebalance" the economy away from services, which includes everything from waitressing to banking.ONS
Year-on-year fourth quarter growth was 1.9%, in-line with forecasts and down from 2.1% in the previous three months.
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