British economy grew by 0.3%

British economy grew by 0.3%

07-12-2010 18:11

The British economy expanded by 0.3% in the first quarter of 2010, according to the most recent official data. The corrected gross domestic product figures match the revised data provided by the Office for National Statistics (ONS) in June. The release of the data concerning the first three months of this year was postponed due to questions about the trustworthiness of some of the numbers.

Gross domestic product

Economists consider the quarterly gross domestic product data as main indicators for the development of the British economy. The quarterly GDP numbers are corrected at monthly intervals. The Office for National Statistics stated that the UK economy found its path out of recession in the last quarter of 2009. Britain’s economy grew at a quarterly rate of 0.4%, which matches previous predictions.

Contraction

The Office for National Statistics noticed that the UK economy shrank by 6.4% between the second quarter of 2008 en the third quarter of last year. Earlier they stated that the economy contracted by 6.2%, implicating that the slump was worse than first expected.

UK economy

“The data demonstrate that the economy is still forecasted to recover rather slowly at the start of 2010. We are still not sure if the UK economy is able to endure the fiscal cuts,” according to Vicky Redwood, a senior UK economist at Capital Economics.

Deceleration

“Everybody is worried about the deceleration shown by the recent figures. We are convinced that the situation will improve gradually,” Royal Bank of Scotland’s UK economist Ross Walker commented.

Deficit

Output in the services sector dropped by 0.3% in April. That was partly the result of problems that emerged after Iceland’s volcanic ash cloud, according to ONS numbers. The Office for National Statistics also published current account figures. These data demonstrate that the UK deficit with other countries in the world rose to €10.71 billion in the last quarter of 2009.