British economy surprises with robust growth in quarter

26th October 2010, Comments 0 comments

Britain's economy expanded by a surprise 0.8 percent in the third quarter, or double market expectations, official data showed on Tuesday as economic recovery took hold.

The figures were published one week after Britain unleashed the biggest public spending cuts for decades. Some economists fear that the radical austerity drive could help push the country into a double-dip recession.

"Gross domestic product (GDP) increased 0.8 percent in the third quarter of 2010, compared with an increase of 1.2 percent in the previous quarter," the Office for National Statistics (ONS) said in a statement.

"The growth in the third quarter is due to growth in ... services, construction and production," it added.

And on a 12-month basis, the economy grew by 2.8 percent in the third quarter compared with the same part of 2009. That was the strongest annual reading since 2007.

"UK growth provided a major upside surprise in the third quarter," said economist Howard Archer at the IHS Global Insight consultancy in London.

The July-September period marked the fourth quarter runing of expansion since the recession, which ended in late 2009. Analysts' forecasts had been for weaker quarterly growth of 0.4 percent.

However, the data marked a significant slowdown from the 1.2-percent surge which was recorded in the second quarter -- which had been the fastest quarterly growth rate for nine years.

The ONS added on Tuesday that the previous April-June period had been skewed by bad weather in the first three months of 2010, which had hampered the fragile recovery.

"Allowing for the recovery in the second quarter following the bad weather at the start of the year, the underlying growth in the third quarter is broadly similar to that in the second quarter," it said.

Last week, Britain's Conservative-Liberal Democrat coalition government had announced plans to cut almost half a million jobs, slashing budgets and welfare benefits as it sought to curb a huge deficit.

© 2010 AFP

0 Comments To This Article