ONS revises growth figure as UK economy fails to meet expectations
26 May, 2017
The Office for National Statistics’ (ONS) first quarter figures showed that GDP rose by just 0.2 per cent – 0.1 per cent less than predicted.
Statisticians had previously predicted a growth of 0.3 per cent in the first three months of 2017.
Household spending rose by 0.4 per cent less than in 2016.
Records showed that spending in the household rose by 0.7 per in the last quarter of 2016, in comparison to 0.3 per cent from January to March this year.
The uncertainty caused by Brexit has apparently affected the economy and it has been suggested that attitudes towards spending money are changing amongst British shoppers.
Mintel’s most recent British lifestyle report, surveying consumer spending, found that over 80 per cent of UK shoppers had concerns over the cost of goods and services post the Brexit vote.
This can be seen as justified reasoning as the decrease in the value of the pound has raised the costs of imports to the UK. As a consequence, shoppers are suffering from higher inflation, putting households under more pressure.
Chris Williamson, chief business economist from the critical information and analytics organisation IHS Markit, said: “There’s a strong likelihood that growth will pick up in the second quarter, but whether robust growth can be sustained further ahead remains highly uncertain.”
Evidence of this can already be seen in the results of the latest Purchasing Managers’ Index which showed that the services sector grew at its fastest rate this year.
This is in addition to recently published official figures which saw retail sales rise, with an increase of 2.3 per cent in April.