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Prospects for the UK Economy

Published online by Cambridge University Press:  26 March 2020

Simon Kirby ,
Ray Barrell  and
Rachel Whitworth
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Extract

The performance of the UK economy was surprisingly weak in the final three months of 2010. The Office for National Statistics (ONS) preliminary estimate of GDP suggests the economy contracted by 0.5 per cent in the quarter. Much of this can be attributed to the exceptionally bad weather in the weeks before the Christmas holidays. But even when this effect is excluded UK economic growth is estimated to have stalled. It is important to gauge the signal in this slowdown, because if it is continued it will affect Bank of England decision making and strengthen the case for restructuring and retiming the fiscal consolidation that is underway. The composition of growth is important in this re-evaluation of prospects. While one would expect the construction sector to be hampered by adverse weather, the contraction in services output was more surprising.

Type
The UK Economy
Information
National Institute Economic Review , Volume 215 , January 2011 , pp. F44 - F62
Copyright
Copyright © 2011 National Institute of Economic and Social Research

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Footnotes

The production of this forecast is supported by the Institute's Corporate Members: Abbey plc, Bank of England, Barclays Bank plc, HM Treasury, Nomura Research Institute Europe Ltd, and the Office for National Statistics and by the members of the NiGEM users group.

References

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