UK GDP: The Revisions Start to Come Through

As always, the official statitisticians’ early takes on the gross domestic product figures are subject to extensive revisions and this is no exception. What we have now is 0.8% growth in the third quarter, as before, but revisions to most other quarters going back to the beginning of 2012.

The result of this is that 2012’s growth rate, originally estimated to be negative, is now modestly positive (0.3%), with further revisions likely. 2013 is on course for 1.8% or 1.9% growth, well above the Office for Budget Responsibility’s latest forecast of 1.4%.

Though the current account figures for the third quarter were a shocker – a deficit of £20.7 billion from £6.2 billion in the second quarter – the latest GDP figures suggest growth is rather better balanced than previously thought. In the first quarter, for example, GDP grew by 0.5% and the contribution of net trade to growth was 0.5%. In the second quarter net trade contributed 0.2% of the 0.8% rise in GDP. The revised quarterly national accounts are here.

Alongside the better GDP figures, there were slightly disappointing borrowing figures. Borrowing in November of £16.5 billion was £0.9 billion higher than a year earlier. Borrowing is still on track to at least meet the OBR’s downward revised projection.

This piece is cross-posted from with permission.