There was some relief that the gross domestic product figures for the third quarter were unrevised, the preliminary rise of 1% having taken people by surprise. Though it is hard to draw any meaningful conclusions from these numbers, on their own they were encouraging.
So consumer spending rose by 0.6% in real terms, its best for nine quarters, and was up by 0.9% on a year earlier. Some of this was a clear Olympics effect, though there was also a large – 1.4% – rise in compensation of employees, its biggest for 11 quarters.
If you were looking for rebalancing, there was some of it too, exports rising by 1.7% on the quarter, while imports fell by 0.4%. Overall investment rose by 0.5%, while business investment jumped by 3.7%.
It was, of course, a distorted quarter, and we will know more about what will undoubtedly be a more muted performance in this and subsequent quarters. There were no revisions to earlier quarters in this release. More here.
This piece is cross-posted from David Smith’s Economics UK with permission.