November 2007 Estimates of Monthly GDP

Pub. Date
07 December, 2007
Pub. Type

Our latest estimate suggests that the growth rate in the three months ending in November is 0.6% after the figure of 0.7% for October. The October industrial production figures were slightly stronger than expected and have offset some of the impact of a slowing services sector. Nevertheless, the figures point to a welcome reduction in the pace of the economy after the rapid growth earlier this year. We expect a further deceleration leading to a period of below-trend growth next year and probably in 2009. 

Our track record in producing early estimates of GDP suggests that our projection for the most recent three-month period has a standard error of 0.14% point when compared to the first estimate produced by the Office for National Statistics. This comparison can be made only for complete calendar quarters. Outside calendar quarters the figures are less reliable than this.

A paper describing the methodology used to produce the data was published in the February 2005 volume of the Economic Journal. From April until October 2006 our estimates were computed using the Index of Services published by ONS. However this monthly series shows considerable volatility which has caused us some problems in estimating GDP. From our November 2006 press release we have therefore reverted to using a model of private services output based on indicator variables. This means that, while all our figures for calendar quarters are fully coherent with ONS data, our estimates of monthly private service output are not. The series can be thought of as indicating the underlying value of the ONS series. 

For more information please telephone Martin Weale on 020 7654 1945.