August 2015 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 0.7 per cent in the three months ending in June 2015. Compared to the same three month period in 2014, this implies a year-on-year growth rate of 2.7 per cent. This is consistent with our recently released quarterly forecast in which we expect an average rate of growth of 2.5 per cent for 2015 as a whole.*
Given the Monetary Policy Committee’s decision today to hold Bank Rate at 0.5 per cent, we continue to expect the first interest rate increase to come in February 2016.
* NIESR’s latest quarterly forecast (published 5th August 2015) projects GDP growth of 2.5 per cent per annum in 2015 and 2.4 per cent in 2016 (see http://niesr.ac.uk/media for the associated press release).