UK gross domestic product (GDP) has sailed past initial estimates thanks to a “noticeable pickup” in growth in the production and manufacturing sectors.
The data, published by the Office for National Statistics (ONS), shows that UK GDP – the main indicator of economic performance – in volume terms was estimated to have increased by 0.5 per cent in quarter 1 of 2019.
This is compared to growth of just 0.2 per cent the previous quarter.
While the UK’s services sector – which includes the retail, finance and hospitality industries and is the UK’s largest contributor to GDP – grew just 0.3 per cent, the economy was strongly supported by the steadfast production sector.
This sector, which encompasses the manufacturing and agriculture industries, grew by 2.2 per cent over the first three months of 2019 – the fastest rate of growth since 1988 in the period recorded.
The ONS said this was partly driven by manufacturing firms “stepping up production to build-up inventories in advance of Brexit and to also meet rising inflows of new work” before the original Brexit deadline of 29 March 2019.
Private consumption, government consumption and gross capital formation also contributed positively, while only net trade contributed negatively to GDP growth, the report adds.
The ONS report reads: “Following a weak picture in Quarter 4 2018, in which all of the four main areas of production experienced a fall in output, there was a pickup in Quarter 1 2019. Production output increased by 1.4 per cent, predominantly driven by manufacturing output, which increased by 2.2 per cent, its fastest rate since Quarter 3 (July to Sept) 1988.”
It added: “This pickup in manufacturing was also captured in the recent Markit UK Manufacturing PMI for March 2019, which recorded a 13-month high in manufacturing activity due to ‘companies stepping up production to build-up inventories in advance of Brexit and to also meet rising inflows of new work’. The rate at which inventories increased was the highest for any G7 country.”
To access the ONS data in full, please click here.