
UK economy improving, but global headwinds remain a threat

UK economy improving, but global headwinds remain a threat
Economic Highlights
– The final estimate for Q2 GDP is quarterly growth of 0.7% and annual growth to Q2 of 1.3%.
– Annual CPI remained at 2.7% in September having been expected to drop off slightly.
– Total employment rose by 155,000 in June-August from March-May, while the unemployment rate eased from 7.8% to 7.7%.
– However, the recent uncertainty regarding the US debt ceiling, and the eventual kicking of the can down the road, has hit sentiment and serves as a reminder of the headwinds we still face in reaching ‘escape velocity.’
Sector Highlights
1 Industrial – UK Manufacturing PMI continued to suggest expansion in September, at 56.7 (Markit).
2 Construction – the UK Construction PMI for September also reported expansion at 58.9 (Markit/CIPS).
3 Office – the UK Services PMI came in at 60.3 in September, representing nine months of continuous growth (Markit/CIPS).
4 Retail – sales volumes in September increased by 0.6%, partly reversing August’s 0.9% monthly drop and leaving annual growth at 2.2%.
5 Residential – UK house prices rose 2.2% in Q3 and are up 4.3% on an annual basis. Greater London saw prices rise 4% over the quarter, and they are up 10% since last year (Nationwide HPI).
6 Debt – the latest Credit Conditions Survey from the Bank of England reports that the availability of real estate credit for commercial property improved below previous expectations in Q3, with availability improving only marginally on the previous three months.
View the full Economics & Real Estate Q3 2013.