LONDON (Businesshala) – Britain’s economy grew by 0.6% in September, but estimates for previous months were revised lower, with GDP compared to February 2020, shortly before the country went into its first COVID-19 lockdown was 0.6% lower.
The data painted a picture of an economy losing its post-lockdown momentum due to global supply chain problems and caution on the part of businesses.
Economists polled by Businesshala had forecast monthly GDP growth of 0.4% for September.
The Office for National Statistics said GDP declined 0.2% in July, a bigger drop than the 0.1% drop previously estimated, while output grew only 0.2% in August, which was originally reported. was lower than 0.4%.
Suren Thiru, head of economics at the British Chambers of Commerce, said: “While monthly output improved during the quarter from the July contraction, it reflects a temporary boost from the easing of restrictions, rather than a meaningful improvement.”
September’s growth was helped by strong output in the health sector as people returned to their doctors after falling during the pandemic, leading to a 0.7% increase in the services sector from August.
But for the fourth month in a row, industrial production declined by 0.4% due to a reduction in gas distribution.
In the third quarter as a whole, GDP grew 1.3%, the weakest three-month growth since Britain was under lockdown in early 2021. A Businesshala poll of the Bank of England and economists had forecast an expansion of 1.5%.
The world’s fifth-largest economy shrank about 10% in 2020, but the International Monetary Fund has forecast the fastest expansion of any group of seven countries in 2021, when it was expected to grow at 6.8%.
However, the quick bounce back from the lockdowns seen in the spring paved the way for slower growth in the summer due to a combination of rising COVID-19 cases, global supply chain problems and post-Brexit shortages of some workers.
The BoE said last week that, as it kept interest rates on hold, recent economic growth was weaker than it expected and it would keep a close eye on labor market conditions after the government’s job protection scheme ends on October 1. ,
Separate data shows the UK’s freight deficit widened by £9bn to £42.3bn in the third quarter, driven by rising imports from EU and non-EU countries as exports declined – notably exclusively for non-EU countries.