(Update) Better-than-expected third quarter growth impresses most economists but FTSE 100 and pound continue to flounder. The UK economy has cleared the Brexit hurdle with ease, with higher-than-expected growth of 0.5% in the third quarter, according to the first official estimate. The increase announced by the Office for National Statistics beat economists’ forecast of 0.3%, according to a Reuters poll, but was down from unusually strong growth of 0.7% in the second quarter which still puzzles experts.
Strong contributions from the mining, transport, hotels and services sectors pushed the annual rate of GDP growth to 2.3%, its highest level in over a year, said the ONS. ‘There is little evidence of a pronounced effect in the immediate aftermath of the vote,’ said ONS chief economist Joe Grice.
Rate cut unnecessary
‘Forget any idea about a rate cut next week,’ quipped Marc Ostwald, strategist at ADM Investor Services International, anticipating the influence the data will have on the Bank of England’s forthcoming monetary policy committee meeting…
[Source: Citywire Money - by Gavin Lumsden - October 27, 2016]