UK economy grows “faster than expected”

The UK economy has grown “faster than expected” and is “well placed to cope with whatever Brexit throws up next”, a report has revealed.

According to the Office for National Statistics (ONS), which published the data, growth was 0.2 per cent stronger than economists forecast.

On a month by month basis, the economy grew by 0.2 per cent, increasing to 0.3 per cent in the three months to February 2019.

Rob Kent-Smith, head of GDP at the ONS, attributed the gain to a “continued strong performance” in the IT, manufacturing, pharmaceutical, chemicals and alcohol sectors.

The figures have come at the same time as the International Monetary Fund (IMF) downgrades the World Economic Outlook. The IMF said worldwide growth would be slower than last year, growing 3.3 per cent in 2019 and 3.6 per cent in 2020.

Commenting on the UK figures, Ruth Gregory, senior UK economist at Capital Economics, said continued Brexit uncertainty may have not have had the major effect experts thought it would.

“Admittedly, the Brexit chaos may have sapped the economy of its momentum in March, as that is when the Brexit uncertainty has been greatest,” she said.

“All told, though, the solid growth rate in the three months to February should ease immediate fears of the economy stalling or contracting in the first quarter and provides support to our view that the economy is well placed to cope with whatever Brexit throws up next.”

Earlier this month, it was also revealed that UK exports grew faster to non-EU countries than to the EU in 2018, “confirming demand for UK goods and services”.

The ONS figures show that during the year to December 2018, UK exports grew 19.3 per cent in India, followed closely by Japan (7.9 per cent), China (4.6 per cent), and Canada (4.2 per cent) – all faster than the recorded 3.6 per cent growth in UK exports to the EU.

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Posted in Business, Economy.