Driven by the health and construction industries, the UK’s economic growth has exceeded expectations
Supported by strong activities in the construction and health sectors, the UK’s economic growth in September exceeded expectations and narrowed the gap with pre-pandemic levels.
According to data from the National Bureau of Statistics on Thursday, the monthly rate of GDP growth in September was 0.6%, higher than the 0.2% in August.
The September data was stronger than the 0.4% forecast by economists surveyed by Reuters.
Output is 0.6% lower than the February 2020 level before the pandemic, which indicates that the economy has basically recovered from the impact of Covid-19 restrictions. The Chinese economy surpassed its pre-pandemic level last year, and the United States reached the same level in the second quarter.
In the three months to September, UK output grew by 1.3% due to lower August and July data, which was lower than the 1.5% forecast by the Bank of England. The growth was lower than the 5.5% growth in the second quarter, when most companies reopened.
The Bank of England expects economic growth to slow to 1% in the third quarter, reflecting the impact of supply chain disruption and rising inflation on corporate and household spending.
Service output increased by 0.7% in September, thanks to a significant increase in health activities and face-to-face appointments at general practitioner clinics in England.
The 0.4% decline in production was mainly due to a 4.1% drop in natural gas distribution, which was the fourth consecutive month of decline after the inclement weather conditions in May drove an abnormally high supply.
The construction industry resumed strong growth after two months of contraction.
Grant Fitzner, chief economist at the National Bureau of Statistics of the United Kingdom, stated that “growth picked up in September” and added that the latest growth was driven by the health sector, and lawyers also had a busy month due to housing purchases. The buyer rushed to complete the purchase before the end of the stamp duty holiday.
However, the growth in these sectors was partially offset by the decline in automobile manufacturing and sales.