"Despite all the predictions of severe disruption to the financial markets following the UK’s decision to leave the EU, these figures paint an altogether more positive picture"
GDP was 2.3% higher in Q3 compared with the same quarter a year ago.
The ONS says the "pattern of growth continues to be broadly unaffected following the EU referendum", with a strong performance in the services industries offsetting falls in other industrial groups.
In Q3, the services industries increased by 0.8%. In contrast, output decreased in the other 3 main industrial groups with construction decreasing by 1.4%, agriculture decreasing by 0.7% and production decreasing by 0.4%, within which manufacturing decreased by 1.0%.
Jeremy Duncombe, Director, Legal & General Mortgage Club, commented: “Despite all the predictions of severe disruption to the financial markets following the UK’s decision to leave the EU, these figures paint an altogether more positive picture which shows that Britain’s economy remains in a strong position."
Nancy Curtin, Chief Investment Officer at Close Brothers Asset Management, added: “The Brexit bogeyman hasn’t yet been as scary as initially feared. Any lingering concerns over an immediate collapse in growth in 2016 have been officially put to bed, with output continuing to grow in the first major assessment of domestic activity post-referendum.
"Supportive monetary policy has played a part, while the softer pound has kept factory orders ticking along. These, along with robust consumption, will be key levers of growth. But political risk still looms large. The quarter on quarter slowdown in the growth rate suggests Brexit uncertainty is having some bite, and it’s likely the ambiguity around the UK’s exit from the EU will take some of the steam out of the long-term growth rate, with anaemic growth likely to become status quo while Article 50 negotiations rumble on.
"Theresa May has thus far kept her cards close to her chest, and while this may be shrewd negotiating move, many businesses are awaiting more clarity around the UK’s single market status and relationship with the EU before committing to spending plans and investment. Eyes now turn towards Chancellor Hammond’s first Autumn Statement, in which we may see some form of modest stimulus to support growth.”
