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Economic Growth revised downwards

Economic growth figures for Q4 of 2011 have been revised downwards to a contraction of 0.3% by the Office of National Statistics (ONS)

Initial Gross Domestic Product estimates indicated that the economy would only contract by 0.2%.

Transport, communications and business services and finance sectors were blamed for the revision. Data also indicated that real household disposable income had fallen by 1.2% in 2011, representing the biggest decline since 1977.

Richard Driver, an analyst for Caxton FX was disappointed by the downward revision, but stressed that despite restrictions on expenditure there is still some positive economic indicators.

He commented: “The UK’s current account deficit has fallen sharply and the GDP data is from the end of last year, which is of limited significance now as forward-looking data is of far greater relevance.

“Today’s figure turns up the heat somewhat on the Q1 2012 GDP figure but we remain confident that we will see the UK economy bounce back.

“Next week’s March PMI figures will be crucial if sterling is to push on from current levels, the possibility of further UK QE really needs to be taken off the table.”

This was posted in Bdaily's Members' News section by Ruth Mitchell .