Wednesday, March 28, 2012
GDP down 0.3% in Q4
Posted by David Smith at 11:00 AM
Category: Thoughts and responses

When the fourth quarter GDP figures were first published showing a decline of 0.2%, there was some relief that the fall wasn't bigger. Now we know it was - the Office for National Statistics has revised the number to a fall of 0.3%. This is, of course, an early-stage revision: in a couple of years time the GDP figures will look nothing like this.

Everything apparently fell in the fourth quarter, with the service sector down 0.1%, construction 0.2% and industrial production 1.3%. An energy-related drop in industrial production is plausible, as is the drop in construction as weaker public spending bites. But the service sector number looks out of line with the surveys.

Consumer spending rose by 0.4% in the fourth quarter but was down by 1% on a year earlier, while govenment consumption was up by 0.5%. Overall investment dropped 0.6%. Exports of goods rose 4% in Q4 but exports of services fell by 2%.

So disappointing numbers, of which more here. There was better news on the balance of payments, with the current account deficit down to 8.5 billion, from 10.3 billion in Q3.