GDP Estimate

April 2014 GDP Estimate

Our monthly estimates of GDP suggest that output grew by 0.9 per cent in the three months ending in March after growth of 0.9 per cent in the three months ending in February 2014. This robust growth was relatively broad based. Even though the level of economic output has almost regained its pre-recession peak (January 2008), a sizeable negative output gap remains. With economic recovery still in its infancy, we do not expect the MPC to change monetary policy, via an increase in interest rates, until the middle of 2015.

March 2014 GDP Estimate

Our monthly estimates of GDP suggest that output grew by 0.8 per cent in the three months ending in February after growth of 0.7 per cent in the three months ending in January 2014. This implies that output is less than 1 per cent below its pre-recession peak (January 2008) and we expect this peak will be recovered over the course of 2014. We do not anticipate that the Bank of England’s MPC will adjust interest rates until the second quarter of 2015.

February 2014 GDP Estimate

Our monthly estimates of GDP suggest that output grew by 0.8 per cent in the three months ending in January 2014 after growth of 0.7 per cent in the three months ending in December 2013. We expect the output to regain its pre-recession peak (January 2008) in less than nine months time. Even as this event occurs, a large negative output gap will remain. We expect the Bank of England’s MPC to keep interest rates on hold until the second quarter of 2015.

January 2014 GDP Estimates

Our monthly estimates of GDP suggest that output grew by 0.7 per cent in the three months ending in December after growth of 0.8 per cent in the three months ending in November 2013. These estimates suggest the economy expanded by 1.9 per cent in 2013, up from 0.3 per cent in 2012. The level of GDP is now just 1.2 per cent below its pre-recession peak (January 2008). The economy is expected to expand at a reasonable pace in 2014.

December 2013 GDP Estimates

Our monthly estimates of GDP suggest that output grew by 0.8 per cent in the three months ending in November after growth of 0.7 per cent in the three months ending in October 2013. Our estimates suggest that the recent pattern of broad based sectoral growth has continued. These robust rates of growth are consistent with a gradual narrowing of the UK’s negative output gap.

Note: NIESR’s latest quarterly forecast (published 5th November 2013) projects GDP growth of 1.4 per cent per annum in 2013 and 2.0 per cent in 2014.

November 2013 GDP Estimates

Our monthly estimates of GDP suggest that output grew by 0.7 per cent in the three months ending in October after growth of 0.8 per cent in the three months ending in September 2013. Our estimates suggest the current level of GDP is now 5.6 per cent above the trough of the 2008-9 recession (April 2009), but is still 2.3 per cent below its pre-recession peak (January 2008).

October 2013 GDP estimates

Our monthly estimates of GDP suggest that output grew by 0.8 per cent in the three months ending in September after growth of 0.9 per cent in the three months ending in August 2013. We estimate that the production sector provided a positive contribution to GDP growth in the third quarter of this year, despite the drop in the sector’s output between July and August. The current level of GDP is 2.5 per cent below its pre-recession peak (January 2008).

September 2013 GDP estimates

Our monthly estimates of GDP suggest that output grew by 0.9 per cent in the three months ending in August after growth of 0.7 per cent in the three months ending in July 2013. This recent rate of growth is the fastest since the three months ending in July 2010 (also 0.9 per cent). Our estimates suggest the level of GDP is now 2.7 per cent lower than the peak of January 2008. Looking ahead, the rate of growth will likely soften, somewhat, over coming quarters.

August 2013 GDP estimates

Our monthly estimates of GDP suggest that output grew by 0.7 per cent in the three months ending in July after growth of 0.6 per cent in the three months ending in June 2013. These estimates suggest a narrowing of the UK’s large negative output gap. Consumer spending growth has underpinned the recent gains in economic momentum, in spite of the continued decline of real consumer wages. Our monthly GDP estimates are consistent with this pattern continuing in the three months ending in July 2013.

July 2013 GDP estimates

Our monthly estimates of GDP suggest that output grew by 0.6 per cent in the three months ending in June after growth of 0.6 per cent in the three months ending in May 2013. These estimates suggest that economic growth accelerated from 0.3 per cent per quarter in 2013Q1 to 0.6 per cent in 2013Q2, largely due to the performance of the private service sector. Production sector output has been flat since the rebound in February 2013.

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