Less than a year before Brexit, UK economy in weakest growth since 2012

Ioana Erdei 27/04/2018 | 14:21

The UK economy grew at its slowest rate since 2012 in the first quarter of the year, the Office for National Statistics (ONS) has said, according to BBC.

GDP growth was 0.1%, down from 0.4% in the previous quarter, driven by a sharp fall in construction output and a sluggish manufacturing sector.

The ONS said the extreme weather of February and March had had a “relatively small” impact.

Sterling fell sharply as the chances of an interest rate rise in May decreased.

Following the news the pound was down almost one and a half cents against the dollar at $1.3775.

Rob Kent-Smith, head of national accounts at the ONS, said: “Our initial estimate shows the UK economy growing at its slowest pace in more than five years with weaker manufacturing growth, subdued consumer-facing industries and construction output falling significantly.

“While the snow had some impact on the economy, particularly in construction and some areas of retail, its overall effect was limited with the bad weather actually boosting energy supply and online sales.”

The figures are a first estimate and are likely to be revised by the ONS as more data becomes available. Many economists had forecast first-quarter growth of 0.3%.

John Hawksworth, chief economist at PwC, said: “These are only preliminary figures and are based largely on estimates rather than actual data for March, when the snow was at its worst. So there could be larger than usual revisions.”