Britain’s Economy Leapfrogs Q3 Estimates

29 November 2002

UK plc performed better than originally estimated in the quarter to September 30, according to the Office for National Statistics.

On Thursday, the ONS amended upward to 0.8% its earlier growth calculation of 0.7% – the revision marking the nation’s fastest quarterly expansion for over two years. The surge propelled annual expansion for the first nine months of 2002 to 1.8%, against the ONS’ original assessment of 1.7%.

For ordinary mortals like this writer, such fractions of a percentage point seem akin to debating the number of angels that can be accommodated on the head of pin. But according to WAMN’s housetrained statistician, this shift is a significant improvement on the earlier data due to the size of the absolute numbers involved.

The buoyant services sector was the engine driving this growth, powering ahead by 0.9% during the quarter (original estimate: 0.8%). Transport, telecoms and financial services were the foremost categories.

To the surprise of many, the manufacturing sector moved into the recuperation room with factory output growth of 1.1%, its first quarterly increase since Q4 2000.

Analysts, however, were cautious even while accepting that the economy is in healthier shape than predicted. They pointed out that annual growth is unlikely to meet government forecasts.

“We expect the fourth quarter to show a weaker number. It would have to be a really big number if (chancellor) Gordon Brown’s forecasts for the full year are to be met," opined Deutsche Bank’s resident Cassandra, George Buckley.

Data sourced from: BBC Online Business News (UK); additional content by WARC staff