18 April 2016

Economic Update

The Office of National Statistics reported that the UK economy grew at a faster pace in the final quarter of 2015. In the three months to December, GDP grew 0.6% from 0.5% previously. The March meeting of the Bank of England unanimously voted to maintain the official bank rate at 0.5%, with no discussion around the possible rate cut. CPI inflation was unchanged on the year to March, lower by 0.1% to 0.3%. Expectations had been 0.4% 

The CBI’s industrial trend survey revealed that production among UK manufacturers had dropped sharply in the three months to March despite total export orders remaining steady. Two-thirds of this decline reflected weakness in the food and drink sector, with localised flooding and mild weather having hit production. Respondents to the CBI survey suggested that output could rebound over the next three months.

After growth in retail sales during January, February figures were down 0.2%. Overall sales grew only moderately in the year to March (+1)

The Financial Survey showed that optimism amongst firms in the financial sector has fallen at the fastest rate since 2011, although business volumes continued to grow solidly.