UK GDP Growing Faster than Originally Expected

Statistics released to the financial industry this month indicate that UK GDP (gross domestic product) is growing at a rate faster than initially expected. This further bolsters the position that the British economy has entered a period of sustained recovery.

The statistics, released by the Office of National Statistics, (ONS), provides key insights on the rate of growth of the national economy. The key figure showed that GDP was up 0.8% in the July – September period from the same period in 2012.

In this case this confirmed earlier figure estimates the ONS had provided on the rate of national GDP growth. However it also led to a revision of earlier figures. This means that the rate of estimated annual growth, originally estimated at 1.5%, has now risen to 1.9%. This helps confirm economists’ theory on the positive state of economic recovery.

GDP is the primary tool that most economists use to measure economic growth. It is the market value of all officially recognised financial goods and services. Measuring GDP measures trade, this is the key element to estimating growth.

In an article for the BBC that featured when the statistics were first released, they feature a statement from a spokesman from the Treasury on the figures in question.

At the time the spokesman said that "today's data show that the recovery has been stronger than previously thought and that the government's long-term economic plan is working.”

However the spokesman was also cautious. He warned that “risks remain and the job is not done, so the government will go on taking the difficult decisions needed to deliver a responsible recovery for all." 

This is a warning many in the economic sector have issued over the latter half of the year in connection to the perception of a national economic recovery. Economists from various sectors have warned that recovery in such areas as the housing market could be indicative of future bubbles that could lead to future economic crashes.

This position has been strengthened by data released by the ONS on Britain’s current account deficit. This figure shows the gap in money received from exports and imports. This gap saw a sharp rise in the third quarter of 2013.  It rose £20.7 billion, up from £6.2 billion in the second quarter. This has led to fears over government borrowing.

Kiran Trivedi readers the economy is in constant flux, the industry can’t accurately predict where it may take us next every time. However as long as the sector remains vigilante against excess, we should be able to avoid a financial calamity the likes of the infamous 2008 crash.