The United Kingdom’s gross domestic product (GDP) improved slightly in the second quarter of 2017, but it’s nothing to write home about. The preliminary GDP estimate rose 0.3% in the three months ending with June, which is ahead of the 0.2% uptick seen at the start of the year.
“GDP growth for the U.K. has been anemic,” said NACM Economist Chris Kuehl, Ph.D. “There is little chance this will change much this year. Now that most understand the damage that has been caused by Brexit, the sense is that Q3 will be slow as well.”
“The economy has experienced a notable slowdown in the first half of this year,” said Office for National Statistics (ONS) Head of National Accounts Darren Morgan in a release. Despite the lack of substantial growth, “[economic] activity remains 9% above its predownturn peak,” according to the ONS.
Construction and manufacturing were the weak links during the second quarter, but retail and film production and distribution showed improvement.
“These meager growth rates indicate that the economy has lost momentum in 2017 and will consequently fail to achieve the 1.8% expansion seen in 2016,” said IHS Markit Chief Business Economist Chris Williamson.
The Bank of England expected a growth of 0.4% in the second quarter. IMS Markit is forecasting a growth of 1.4% this year, while the International Monetary Fund recently downgraded its expectation to 1.7%. Last year, the Bank of England predicted a GDP growth of 0.8% in 2017. In order to reach that prediction, “GDP would need to contract by an average of 0.7% in each of the remaining two quarters in order to hit the annual GDP growth predicted by independent forecasts and the BoE,” said the ONS.
– Michael Miller, editorial associate