Home Business News UK economic growth rises due to manufacturing push

UK economic growth rises due to manufacturing push

by LLB Reporter
10th May 19 10:29 am

UK economic growth accelerated for the first quarter of 2019 which was driven by the highest pick-up in manufacturing since the 1980’s.

According to the Office for National Statistics (ONS) gross domestic product (GDP) rose to 0.5% for the first quarter, as the original Brexit deadline loomed.

Compared to the previous quarter growth was 0.2% as car manufacturing fell to its steepest rate in under ten years.

GDP was up by 1.8% compared to the same quarter last year, and jn the quarter production output was up by 1.4%. This was boosted by a 2.2% hike in manufacturing.

Manufacturers delivered orders early as companies cleared their order books ready for the original Brexit withdrawal date of 29 March.

Strong first quarter performance unlikely to last for the rest of the year says Yael Selfin, chief economist at KPMG UK, “A strong manufacturing performance in the first quarter coincides with survey evidence, which points at manufacturing continuing to outpace services in coming months.

“The rise in business investment in the first quarter, after four quarters of contraction, is particularly welcome. The worry is that a significant part of that was related to stockpiling activities ahead of an expected Brexit at the end of March, rather than a sign that businesses were finally moving on with their investment plans thanks to renewed confidence.

”Looking ahead, the unwinding of potential stockpiling effects in Q1 is likely to see a weaker Q2, leaving the UK economy only marginally stronger than expectations at the start of the year.”

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