UK GDP Annual Growth at 1-1/2-Year High

Britain's economy expanded 1.8 percent year-on-year in the first quarter of 2019, up from 1.4 percent in the previous period and in line with market consensus. It has not been stronger since the third quarter of 2017.

On the expenditure side, household expenditure rose 1.9 percent in the first quarter (vs 1.7 percent in Q4); and government spending advanced 2.2 percent (vs 1.0 percent in Q4). In addition, fixed investment surged 1.7 percent (vs -1.1 percent in Q4) despite a further decline in business investment (-1.4 percent vs -2.5 percent).

Imports jumped 10.2 percent, following a 2.6 percent increase in Q4; while exports rose at a much slower 1.5 percent, after a 0.2 percent gain in the previous period. As a result, the trade deficit widened sharply to £17.510 billion from £4.268 billion in Q1 2018.

On the production side, the service industries expanded 2 percent, the same as in Q4, as output rose for: distribution, hotels and restaurants (4.3 percent vs 3.5 percent); transport storage and communications (4.5 percent vs 3.9 percent); business services and finance (0.9 percent vs 1.4 percent); and government and other services (1.2 percent vs 1.1 percent). Industrial production rebounded 0.6 percent (vs -0.7 percent in Q4), as output grew for manufacturing (1.2 percent vs -1.3 percent) and mining & quarrying (6 percent vs 8.7 percent). By contrast, utilities output contracted for the fourth straight period (-5.9 percent vs -2.5 percent) and water supply, sewerage, waste management and remediation activities declined for the second consecutive quarter (-0.4 percent vs -0.7 percent). Construction expansion accelerated to 2.8 percent from 0.3 percent in Q4.

UK GDP Annual Growth at 1-1/2-Year High

ONS | Joana Ferreira |
5/10/2019 9:16:33 AM