Manufacturing and exports continue to be a weak spot for the UK, dimming outlook for a balanced economy.
Data shows that industrial production for the region advanced by just 0.3% between the months of May and June to fall below the 0.6% City forecast. The gauge dropped by 0.7% in the prior month. The results indicate the the UK is still heavily reliant on its services sector, which has already surpassed its pre-recession peak, to spur economic growth. Both construction and manufacturing are 10% and 8% below their respective peaks.
Investec economist Victoria Clarke said that, “It could well be left to the services sector to do much of the heavy lifting in driving recovery momentum through the remainder of the year.” The sector contributed 0.77 percentage points in the second quarter gross domestic product growth of 0.8%.
For British Chamber of Commerce chief economist David Kern, it just shows that there are still obstacles that the UK must overcome to secure its continued recovery. The National Institute of Economic and Social Research has already scaled back its growth estimates from the 0.8% in the three months until June to 0.6% for the three months until July due to the poor performance of the UK’s industrial sector.
Additionally, according to Halifax, prices for houses climbed by 1.4% to help inflation increase to 10.2% in the three months until July to achieve the fastest rate of increase in almost seven years. Berenberg Bank’s chief UK economist Rob Wood, however, says that this was “more like a speed bump than a roadblock” with the housing market coping with new regulations on mortgages.
The material has been provided by InstaForex Company – www.instaforex.com
Manufacturing and exports continue to be a weak spot for the UK, dimming outlook for a balanced economy.
Data shows that industrial production for the region advanced by just 0.3% between the months of May and June to fall below the 0.6% City forecast. The gauge dropped by 0.7% in the prior month. The results indicate the the UK is still heavily reliant on its services sector, which has already surpassed its pre-recession peak, to spur economic growth. Both construction and manufacturing are 10% and 8% below their respective peaks.
Investec economist Victoria Clarke said that, “It could well be left to the services sector to do much of the heavy lifting in driving recovery momentum through the remainder of the year.” The sector contributed 0.77 percentage points in the second quarter gross domestic product growth of 0.8%.
For British Chamber of Commerce chief economist David Kern, it just shows that there are still obstacles that the UK must overcome to secure its continued recovery. The National Institute of Economic and Social Research has already scaled back its growth estimates from the 0.8% in the three months until June to 0.6% for the three months until July due to the poor performance of the UK’s industrial sector.
Additionally, according to Halifax, prices for houses climbed by 1.4% to help inflation increase to 10.2% in the three months until July to achieve the fastest rate of increase in almost seven years. Berenberg Bank’s chief UK economist Rob Wood, however, says that this was “more like a speed bump than a roadblock” with the housing market coping with new regulations on mortgages.
The material has been provided by InstaForex Company – www.instaforex.com
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