NIESR Monthly GDP Tracker – UK economy narrowly avoids recession
- The UK economy is on course to contract by 0.1% in the second quarter of 2019. Two quarters of contraction would mean that the economy is in a technical recession, but the initial outlook for the third quarter of 2019 is for growth of 0.2% (figure 1). If correct, that would still imply that the economy has lost significant moment since the first quarter.
- According to new ONS data published this morning, the UK economy expanded by 0.3 per cent in the three months to May. This outturn was higher than the 0.1 per cent that we forecast last month for the same period due to higher than expected electricity production.
Janine Boshoff, Economist in the Macroeconomic Modelling and Forecasting team, yesterday said:
“Our latest estimate implies that the economy will narrowly avoid a technical recession in the middle quarters of this year. That said, the latest ONS data and recent surveys suggest that the economy has lost considerable momentum since the first quarter. This reflects the impact of Brexit-related uncertainty and slower growth in the global economy outside of the United States. The near-term outlook for the UK economy continues to depend on the outcome of the Brexit negotiations.”.
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