Growth figures slow amidst Brexit uncertainty
Comment from credit and risk specialist from Dun & Bradstreet, Markus Kuger said:
“The preliminary real GDP growth figures for Q3 came in at 0.5% quarter on quarter, down from the 0.7% seen in Q2. As the consensus forecast stood at 0.3%, Q3 figures performed surprisingly well and the economy continues to show some resilience to the uncertainty of Brexit. However, things will be expected to fall in the coming quarters as the UK edges closer to invoking Article 50. We will have to wait many more quarters to assess the true impact of Brexit, but businesses should be completely frank in understanding that the figures are not as positive as they appear.
“Deeper analysis shows that output in three out of four sectors declined: construction (1.4%), agriculture (0.7%) and production (0.4%) all shrank. Meanwhile, the services industry posted a strong performance that offset the aforementioned industries. Worryingly, as the UK government moves towards a ‘hard Brexit’, financial services should prepare for the potential of leaving the single market and losing passporting rights, which will undoubtedly further drag down the services-led GDP-growth.”
