And service industries output jumped by 0.7 per cent in the period, up from 0.2 per cent. Services accounts for more than three quarters of the nation’s total GDP.
The overall growth was better than expected, as most economists had predicted a figure of between 0.3 and 0.4 per cent. However, growth is still below its long-term average and it is feared that the GDP was just playing catch-up after the previous quarter, which as hit by one-off factors such as the Royal wedding.
The statement from the ONS said “As with 2010 Q4 and 2011 Q1 (affected by the bad weather in Q4), it may be wise to look at 2011 Q2 and 2011 Q3 together, rather than separately, On that basis, GDP has grown by 0.6 per cent in the last two quarters and by 0.5 per cent in the last year.”
Notably, the ONS says that there is ‘no evidence’ that the riots in August had any significant impact on GDP during the third quarter.
David Kern, chief economist at the British Chambers of Commerce, said of the data, “The figures for Q3 are better than expected, though they follow particularly disappointing 0.1 per cent growth in the previous quarter, which was affected by special factors.”
He went on to say: “Over the last year growth has been relatively weak at only 0.5 per cent, but it is reassuring that fears of a recession have so far been unfounded. There are still risks ahead. Early indications from the fourth quarter are concerning, and if the situation in the Eurozone worsens there could be serious adverse repercussions for the UK.”
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