Economy slows; GDP rises

Posted on 24 Oct 2014 by Victoria Fitzgerald

UK economic growth has slackened in the third quarter, with the GDP increasing by 0.7%, according to the Office for National Statistics.

Economists anticipated the 0.7% expansion in the period from July to September. The amount was weaker than the second quarter, which recorded a 0.9% expansion and the GDP recorded a 3% increase from the same period last year.

The news comes as the UK is told to pay an extra £1.7bn towards the EU’s budget as the most rapidly-growing economy in 2014. The fee is based on EU calculations to assess the amount each member state should contribute. The sum would increase the UK’s annual net contributions to the EU of £8.6bn by a fifth.

Commenting on today’s GDP data, Felicity Burch, Senior Economist at EEF, the manufacturers’ organisation, said:

“Today’s estimates confirm the economy has slowed, with little surprise that export-intensive sectors have been most affected.

“After strong growth in the first six months of the year, the pace of growth in manufacturing has also slackened as a result of weaker demand from key markets including Europe and China.

“Nonetheless, the domestic economy remains relatively upbeat, and manufacturing sectors with strong exposure to the UK should do particularly well. Manufacturing is still on track to grow at its fastest pace since 2010.”