Third quarter growth figures will change the terms of political debate for George Osborne, but investment remains sluggish.
Click on link: http://www.telegraph.co.uk/finance/financevideo/10404138/GDP-figures-This-latest-growth-will-change-the-political-debate-on-the-economy.html
This 0.8pc rise in GDP for June to September is the highest quarterly increase in three years, so the economy is clearly moving in the right direction. That’s got to be good news for commercial and employment prospects across the UK, but I still have some big reservations about the pace and shape of this recovery.
So the UK has dodged the dreaded “triple-dip”. While British GDP fell 0.3pc during the final quarter of 2012, last week came news that our national income increased 0.3pc during the first three months of this year. That meant we avoided two successive quarters of contraction – the standard definition of “recession” and a state this country has already endured twice since the credit crunch was sparked in 2008.
A “triple-dip”, the UK’s first in modern times, would have driven some very nasty headlines for George Osborne. For now, the Chancellor is no doubt allowing himself a sigh of relief. He will be more than aware, though, that for all his “healing” rhetoric, the UK economy remains extremely fragile.