Figures out today showed a contraction in the UK economy, shrinking 0.5 per cent in the fourth quarter of 2010, reports Shamik Das.
Figures out today showed a contraction in the UK economy, shrinking 0.5 per cent in the fourth quarter of 2010. The Office for National Statistics, which published the figures this morning, state:
“The chained volume measure of gross domestic product (GDP) decreased 0.5 per cent in the fourth quarter of 2010, following growth of 0.7 per cent in the previous quarter.
“Output in the production industries increased 0.9 per cent; output in the construction sector decreased 3.3 per cent; output in the service industries decreased 0.5 per cent. GDP increased 1.7 per cent in 2010 Q4 compared with 2009 Q4.”
The graph below shows the quarter-on-quarter percentage change in GDP:
The ONS add:
“The figures published today show that GDP declined by 0.5 per cent in 2010 Q4. The change in GDP in Q4 was clearly affected by the extremely bad weather in December last year. The disruption caused by the bad weather in December is likely to have contributed to most of the 0.5 per cent decline, that is, if there had been no disruption, GDP would be showing a flattish picture rather than declining by 0.5 per cent.
“We should emphasise that this assessment of the effect of the bad weather is the best we can make it at this stage, but is still inevitably uncertain.”
Production industries, which include manufacturing and utilities, were a much-needed bright spot for the economy having increased by 0.9 per cent on the previous quarter.
Left Foot Forward will have political reaction to the figures later today.Like this article? Sign up to Left Foot Forward's weekday email for the latest progressive news and comment - and support campaigning journalism by making a donation today.