In the third quarter, the UK economy saw stagnation, primarily due to a stagnant services sector. The moderate expansion in construction was counterbalanced by a decline in industrial production, as reported by the Office for National Statistics on Monday.
The real gross domestic product (GDP) saw no growth during this period, a revision from the initial estimate of a 0.1% increase. This follows a healthier 0.4% growth in the previous quarter. Specifically, the services sector, a major contributor to the economy, experienced zero growth in the third quarter, contrary to the preliminary estimate of a 0.1% rise.
Construction output increased by 0.7%, slightly down from an initial 0.8% increase, after experiencing three consecutive quarterly declines. However, this gain was nullified by a 0.4% drop in industrial production, which was revised from an earlier estimate of a 0.2% decline.
Year-on-year, the real GDP grew by 0.9%, slightly below the previously estimated 1.0% increase.
Examining GDP components in terms of expenditure, household spending rose by 0.5%. Government expenditures also increased, albeit modestly, by 0.1%, a downgrade from an earlier estimate of 0.6%.
Additionally, growth in gross fixed capital formation saw an upward revision to 1.3% from 1.1%. Within this category, business investment rose by 1.9%.
Revised figures—excluding alignment and balancing adjustments—indicate real inventories grew by £2.5 billion in the third quarter, primarily due to increased stock levels in the manufacturing sector.
