UK’s 2018 GDP Falls To The Slowest Pace Since 2012

Data showed that the nation’s GDP increased just by 0.2% up to December 2018.

Growth slowed down more than half from the third quarter when the economy advanced 0.6% back then. This was, however, the preliminary release by the ONS and the data is subject to revisions in the coming weeks.

Economists estimated that the UK’s economy would grow by 0.3% in the fourth quarter of 2018. However, the actual data came out lower than expected.

UK’s quarterly GDP growth, 2018

The UK’s economy had remained week for most of last year. Here is a summary of the UK’s growth figures every quarter in 2018.

Period GDP (%)
Q1 (Jan – March) 2018 0.1%
Q2 (April – June) 2018 0.4%
Q3 (July – September) 2018 0.6%
Q3 (October – December) 2018 0.2%

On a year over year basis, the UK’s GDP was seen rising 1.3% in the fourth quarter of the year. This was the weakest pace of increase in GDP since the second quarter of 2012.

The annual growth rate of 1.4% was slightly lower compared to the 1.6% increase forecasted by economists.

Head of ONS GDP, Rob Kent, said that the slowdown in the fourth quarter’s GDP came on account of weakness in the car manufacturing sector and a decline in steel production. The GDP decline was also accelerated by sharp falls in the construction sector as well.

The only exception was the services sector. Health, management and IT managed to offset some of the declines from the manufacturing and construction sectors.

For December, GDP fell by 0.4% during the month. This is somewhat better compared to the forecasts which showed that economists expected the UK’s GDP to stagnate.

There was a broad-based decline among sectors including construction, production, and services. This was also the first time that there was a decline across all the sectors since September 2012.

More sectors affected

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