ZCZC
BCN-19
BRITAIN-ECONOMY-GROWTH-BREXIT
UK economy grinds to halt in August
LONDON, Oct 11, 2018 (BSS/AFP) – Britain’s Brexit-facing economy ground to
a shuddering halt in August, hit by weaker hotel and restaurant activity,
official data showed Wednesday.
Six months before Britain is due to leave the European Union, gross
domestic product (GDP) registered zero growth, the Office for National
Statistics said in a statement.
That followed an upwardly-revised 0.4-percent expansion in July, which was
boosted by sunny weather and the World Cup football tournament.
The ONS added that the 2018 summer heatwave provided a welcome lift to the
economy, after it had suffered under unusually cold weather earlier in the
year.
The August GDP print however undershot analysts’ consensus forecasts for
anaemic growth of 0.1 percent.
Meanwhile, the economy grew 0.7 percent in the three months to August
compared with the previous three months. That outpaced market expectations of
0.6 percent.
“The economy continued to rebound strongly after a weak spring, with
retail, food and drink production and housebuilding all performing
particularly well during the hot summer months,” said Rob Kent-Smith, ONS
head of GDP.
“However, long-term growth continues to lag behind its historical trend.”
Howard Archer, chief economic advisor to the EY ITEM Club, forecast that
growth would rebound in the third quarter of this year, or three months to
September.
However, he cautioned that Brexit uncertainty would likely spark another
slowdown towards the end of the year.
“We think there is a very real risk that growth will slow markedly in the
fourth quarter due to appreciable Brexit and political uncertainties weighing
down on business investment and also limiting client willingness to place
major contracts,” he noted.
Britain will depart from the European Union at the end of March 2019.
BSS/AFP/HR/1115