Britain Third-Fastest Growing Economy in G7 Despite Brexit and Gloomy Predictions

The UK's economy grew by just 1.4 per cent in 2019 according to ONS figures

The UK's economy grew by just 1.4 per cent in 2019 according to ONS figures

Official figures released on Tuesday showed zero growth in the fourth quarter compared with the third, matching the median forecast in a Reuters poll of economists. In 2021, the growth estimates of the Central Bank, accelerated to 1.5%.

The ONS's head of GDP said: "There was no growth in the last quarter of 2019 as increases in the services and construction sectors were offset by another poor showing from manufacturing, particularly the motor industry".

Growth in both services and construction was offset by a fall in production, which resulted in 0.0% GDP growth in the three months to December 2019. However, it is still one of the slowest rates of growth since the financial crisis gripped the global economy in 2008 and 2009.

"This is a mucky figure with the true sense of the United Kingdom economy's performance occluded by the election of December 12", said Jeremy Thomson-Cook, chief economist at payments provider Equals Group.

However, the first estimate for December's GDP showed that it grew by 0.3%, compared to a 0.3% decline a month previously.

Recent survey data suggests industry enjoyed a "Boris bounce" in the wake of the prime minister's surprisingly convincing election victory in mid-December.

"More forward-looking data are more optimistic, and while outright optimism would be misplaced, upgrades to previous quarters are well received".

"The volatility throughout the first half of 2019 has been particularly pronounced in the production sector, specifically in manufacturing". That marked a big swing from the -0.3% contraction suffered in November and was better than analysts had forecast.

Manufacturing output posted its sharpest fall since 2013.

However, there were warnings that the upturn might not last and instead reflected a temporary blip after political uncertainty around Brexit and December's election weighed on activity for much of the final quarter of 2019.

In the end, a relatively strong December meant ministers were spared the task of having to explain why national output had fallen for a second time in three quarters.

Last three months of 2019 also saw the trade deficit in goods and services widened to £ 6.5bn from £ 4bn deficit seen between July and September. The economy performed badly but not quite as badly as some had feared.

Senior economist at Capital Economics Ruth Gregory said the flat growth in the final three months of previous year would "prove to be a low point".

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