United Kingdom economy grows by 0.6 per cent

UK plc only slowed slightly from the rate of 0.6 per cent in the previous two quarters

The International Monetary Fund projects USA economic growth at 2.3% this year and 2.5% in 2018. What's more, the government statistics got the direction of growth wrong about a third of the time.

Analysts Capital Economics noted that, at 0.6%, growth was above consensus but predicted a slowdown for 2017. Companies ramped up resource-related investments once crude prices stopped dropping, and research and development spending picked up as well.

After adjusting for inflation, such sales grew 2.5 percent last quarter, the fastest since the third quarter of 2015, following a 2.1 percent increase. The current expansion has lasted longer than the historical average, but its average rate has been the weakest since at least 1949. That's a rarity given the trend over the past several years.

"Looking ahead to 2017, the major question is whether a squeeze on real household incomes, and the impact of Brexit uncertainty on the corporate sector, will be offset by the benefits of cheaper sterling against a stronger backdrop of global economic growth".

Nancy Curtin, chief investment officer at Close Brothers Asset Management, said: "The "America First" expansionary policy, which is expected to include increased infrastructure spending and highly pro-business policies, should stimulate further growth in GDP". A strong dollar can hurt manufacturers by making USA exports more expensive for foreign customers.

Sohn predicted growth rates could jump to 3.5 to 4 percent. The world economy has also helped economic growth with positive indicators in all the main economic regions - Europe, North America and Asia. CFO Kevin March told analysts this week.

Ashworth said he expects four rate hikes this year, but the first one won't come until June. It outstrips the 1.9 per cent recorded by Germany last year and is likely to be ahead of full-year estimates for the USA and eurozone, due to be published imminently. We're at a turning point on the upside for business investment.

The housing recovery continued last quarter.

In 2016 as a whole the economy grew by two per cent, this is down from 2.2 per cent in 2015. Business inventories rose to $48.7 bln in 4Q16 compared to $7.2 bln in Q3m while spending on heating and machinery rose 3.1pc year-on-year in the fourth quarter. The rate of growth was unchanged from the previous two quarters. Mortgage rates remain low but have risen in recent months, posing a potential headwind for buyer demand in 2017. The ONS says the slower rate of growth was mainly due to a fall back, following a particularly strong Q3 in the motion picture and computer programming and consultancy industries. In the third quarter, real GDP increased 3.5 percent.

What took headline growth lower in the quarter? The median forecast in a Bloomberg survey called for 2.2 percent.

Related:

Comments

Latest news

Google Pixel 2B with smaller price tag is reportedly under works
However, they made a decision to replace it with a " better " Google Assistant making it the first non-Pixel phone to have it. The new Pixel phones sport a 12.3-megapixel camera with f/2.0 aperture, 1.55um pixels and unlimited Google Photos storage.

Alphabet earnings surge on mobile, YouTube
Amazon seems prepared to abandon quarterly profits to invest even more in faster delivery times or in another huge data centre. Porat said in comments during the conference call that hardware, cloud and Play app store sales all were strong.

The women's march needs your understanding
Click the photos below to see the marches. "If we can give them that first step with this march, then that's great for all of us". Kenyan Muthoni Ngige, 28, said: "I'm here because I'm against world leaders being pussy grabbers".

Other news