Economic recovery still on course

The UK economy grew in the first quarter of 2010 confirming that the recovery is still on course, according to early official estimates.

The economy, as measured by gross domestic product (GDP), increased by 0.2% in the first quarter against the final quarter of 2009. The increase in output was due mainly to increases in business services and finance and manufacturing, the Office for National Statistics (ONS) said.

The production industries increased by 0.7% on the previous quarter, and in that figure, manufacturing also increased by the same figure. However, mining and quarrying decreased 0.7%, while the utilities — electricity, gas and water supply — increased 2.5%.

Howard Archer, chief economist at IHS Global Insight, argued that the lower-than-expected growth figure was “not in itself overly worrying”.

“Overall growth in the first quarter was clearly dragged down appreciably by the very bad weather in January, and most indicators suggest that there has been a marked pick up in activity since then,” he said.

As more detailed economic information becomes available to the ONS, they will release further estimates for first quarter growth. For example, the initial estimate for the final quarter of last year was 0.1% growth, but this was gradually raised to 0.4%.

www.statistics.gov.uk/pdfdir/gdp0410.pdf

http://news.bbc.co.uk/1/hi/business/8639160.stm