UK GDP growth unchanged at 0.3%

Declan Curry explains just what GDP stands for, and why we should care

The UK economy grew by 0.3% in the quarter from January to March, the latest official figures have confirmed.

The revision of the GDP data is unchanged from that issued by the Office for National Statistics in June.

But the ONS also said that revised figures for last year as a whole show the recession was deeper than first thought.

Release of the numbers was delayed two weeks while the data was double-checked because of concerns about reliability.

The ONS confirmed that Britain emerged from recession in the fourth quarter of 2009, with the economy growing at a quarterly rate of 0.4%, as earlier estimated.

Deeper recession

However, as part of a major revision of previous quarters' GDP data, the ONS said that Britain's economy contracted by 6.4% between the second quarter of 2008 and the third quarter of 2009.

This is more than the 6.2% reported previously, suggesting that the recession was deeper than first thought.

What is GDP?

  • Gross domestic product
  • A measure of a country's economic activity, namely of all the services and goods produced in a year

Vicky Redwood, of Capital Economics, said the figures "show that the recovery is still estimated to have got off to a fairly slow start at the beginning of the year."

She added: "We still doubt that the economy is in a good position to withstand the fiscal squeeze".

However, Ross Walker, economist at RBS Financial Markets, was slightly more optimistic about future growth.

"Everybody's eyeing with a little bit more concern some of the loss of momentum we are seeing in the latest surveys. The rear view mirror stuff is fine and it's going to continue to get better, but we know that," he said.

Separate ONS data showed that output in the services sector fell by 0.3% in April, in part due to disruption from Iceland's volcanic ash cloud.

The ONS also released first-quarter current account data, which showed that Britain's deficit with the rest of the world widened to £9.628bn in the last three months of 2009.

Graph showing GDP growth since 1990

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