UK economy grew 0.1 percent in August ahead of budget

The British economy unexpectedly grew by 0.1 percent in August, official figures from the Office for National Statistics showed. CNBC and The Guardian both reported that economists polled by Reuters and City analysts had expected gross domestic product to shrink by 0.1 percent. BBC News added that the growth figure was stronger than expected. [1][2][3]

The Office for National Statistics reported that production grew by 0.8 percent in August, which CNBC noted helped offset weak output. However, CNBC reported that services showed no growth and construction fell by 0.2 percent. The Guardian reported that the monthly growth followed a 0.4 percent rise in July, while consumer spending fell ahead of the upcoming budget. [1][2][3]

Over the three months to August, overall economic growth reached 0.7 percent, BBC News reported. Office for National Statistics director of economic statistics Liz McKeown told BBC News that computer programming was the primary driver of growth during that three-month period. She added that the production and construction sectors both shrank across those three months. [1]

Gross domestic product measures the total market value of final goods and services produced within an economy. As FTMQ News reported earlier, Chancellor John Healey is scheduled to present his first budget on 28 October. [13][15]

Capital Economics chief UK economist Paul Dales told BBC News that the British economy was more robust than previously thought. However, he warned that an expected increase in inflation would still dampen future economic growth. [1]