Freaking news
http://today.reuters.co.uk/news/news...RITAIN-GDP.xml
Economy grows faster than expected
Wed Jan 25, 2006 10:34 AM GMT
Related Articles
Chinese economy leaps French, eyes British
By Fiona Shaikh and Ross Finley
LONDON (Reuters) - The economy grew at its fastest quarterly pace in a year in the last three months of 2005, helped by a pick-up in services and reinforcing expectations interest rates will stay on hold for now.
The Office for National Statistics said on Wednesday that gross domestic product increased by 0.6 percent in the fourth quarter, outstripping analysts' forecasts for a 0.5 percent rise and better than 0.4 percent growth posted in Q3.
That left the annual rate of growth unchanged at 1.7 percent, better than the 1.6 percent rate expected.
The pound rose to a four-month high against the dollar and strengthened against the euro, while interest rate futures fell as markets bet the Bank of England is not about to trim borrowing costs from their current 4.5 percent.
The figures coincided with minutes from the Bank's January meeting, which showed that eight members of the Monetary Policy Committee voted to keep rates on hold, with only one, Stephen Nickell, repeating his December call for a cut.
"The rise from sub-trend quarters stems from a very robust performance across all private sector services, which offset falling industrial production and more modest growth in government services," said Geoffrey Dicks, economist at RBS Financial Markets.
"The MPC did not know these data but still saw growth continuing broadly in line with the historic average. While it does so rates are on hold."
For the full year 2005, GDP grew by 1.8 percent, the weakest since 1992 but slightly above Chancellor Gordon Brown's 1.75 percent estimate which he revised down in December's pre-budget report.
SERVICES SURGE
The ONS said Q4 growth was lifted by the services sector, which put in its best performance in 1-1/2 years, expanding by 0.9 percent.
Within that, hotels, distribution and catering rebounded in Q4 by 1.2 percent on the quarter and 1.4 percent year-on-year -- further evidence that consumer spending is recovering from weakness seen through most of 2005. Continued ...
Economy grows faster than expected
Wed Jan 25, 2006 10:34 AM GMT
Related Articles
Chinese economy leaps French, eyes British
By Fiona Shaikh and Ross Finley
LONDON (Reuters) - The economy grew at its fastest quarterly pace in a year in the last three months of 2005, helped by a pick-up in services and reinforcing expectations interest rates will stay on hold for now.
The Office for National Statistics said on Wednesday that gross domestic product increased by 0.6 percent in the fourth quarter, outstripping analysts' forecasts for a 0.5 percent rise and better than 0.4 percent growth posted in Q3.
That left the annual rate of growth unchanged at 1.7 percent, better than the 1.6 percent rate expected.
The pound rose to a four-month high against the dollar and strengthened against the euro, while interest rate futures fell as markets bet the Bank of England is not about to trim borrowing costs from their current 4.5 percent.
The figures coincided with minutes from the Bank's January meeting, which showed that eight members of the Monetary Policy Committee voted to keep rates on hold, with only one, Stephen Nickell, repeating his December call for a cut.
"The rise from sub-trend quarters stems from a very robust performance across all private sector services, which offset falling industrial production and more modest growth in government services," said Geoffrey Dicks, economist at RBS Financial Markets.
"The MPC did not know these data but still saw growth continuing broadly in line with the historic average. While it does so rates are on hold."
For the full year 2005, GDP grew by 1.8 percent, the weakest since 1992 but slightly above Chancellor Gordon Brown's 1.75 percent estimate which he revised down in December's pre-budget report.
SERVICES SURGE
The ONS said Q4 growth was lifted by the services sector, which put in its best performance in 1-1/2 years, expanding by 0.9 percent.
Within that, hotels, distribution and catering rebounded in Q4 by 1.2 percent on the quarter and 1.4 percent year-on-year -- further evidence that consumer spending is recovering from weakness seen through most of 2005. Continued ...
Comment