UK Q4 GDP Growth Revised Up To 0.7%

The British economy advanced 0.7 percent on quarter in the three months to December of 2016, following a 0.6 percent expansion in the previous period and above the preliminary estimate of 0.6 percent, due to upward revisions within the manufacturing industries. On the expenditure side, exports rebounded sharply while household expenditure rose at a slower pace and business investment contracted.
ONS | Joana Ferreira | 2/22/2017 12:31:43 PM
From the expenditure side, the positive contribution to GDP came from net trade (1.3 percentage points), and household final consumption expenditure (0.4 percentage points). In contrast, gross capital formation subtracted 1.1 percentage points from the growth.

Exports jumped by 4.1 percent, following a 2.6 percent drop in the previous period, while imports shrank 0.4 percent following a 1.3 percent gain. As a result, the trade deficit narrowed to £11.0 billion from £17.2 billion in Q3. 

Total domestic expenditure decreased by 0.6 percent, after expanding by 1.7 percent in the previous period, as business investment shrank 1 percent (from 0.7 percent in Q3) while gross fixed capital formation showed no growth (from 0.9 percent). Meanwhile, household expenditure advanced by 0.7 percent (from 0.9 percent in Q2); and government spending rebounded 0.2 (from a flat reading). The level of inventories rose by £1.5 billion, following an increase of £0.4 billion in the previous period. 

From the production side, the service industries increased by 0.8 percent following a 1 percent gain in Q3 and marking the 16th consecutive quarter of growth. Output rose for: Distribution, hotels and catering (2 percent from 1.2 percent in Q3); transport, storage and communication (1 percent from 2.7 percent); business services and finance (0.5 percent from 0.7 percent); and government and other services (0.4 percent, the same as in Q3). Industrial output increased by 0.3 percent (-0.4 percent in Q3), as output expanded for: manufacturing (1.2 percent from -0.8 percent in Q3); electricity, gas, steam and air conditioning supply (3.1 percent from -4.4 percent); and water supply and sewerage (2 percent from -0.1 percent). By contrast, output from mining and quarrying (including oil and gas extraction) contracted by 7 percent (4.5 percent in Q3). Construction output advanced by 0.2 percent, following a 0.8 percent fall the previous period; and agriculture grew 1 percent, the first increase in four quarters.

Compared to the same period of 2015, the economy expanded 2 percent, the same as in the previous period.

Looking at 2016 as a whole, growth slowed to 1.8 percent from 2.2 percent in 2015 and 3.1 percent in 2014.

UK Q4 GDP Growth Revised Up To 0.7%