Wednesday, November 25, 2009
Strange things are still happening in the GDP data
Posted by David Smith at 10:00 AM
Category: Thoughts and responses

Revised GDP figures for the third quarter showed the economy declined by 0.3%, against the preliminary estimate of 0.4%, but remained in recession. As I commented at the time of the original estimate, the Office for National Statistics appeared to have accentuated the negative by projecting a 0.2% decline in service sector output in its initial estimates. It has revised this to 0.1% but that still looks on the low side.

Odder than that is the fact that GDP in nominal terms rose by 1% between the second and third quarters, while GDP in volume terms fell by 0.3%. Unless we had a sudden surge in inflation that everybody missed, that looks hard to reconcile. More details of what remains a GDP mystery here.