UK Third Quarter Annual GDP Growth Revised Up, While Current Account Deficit Surges

on December 20 2013 5:23 AM
UK debt truck
A truck illuminated with the amount of Britain's debt passes the Houses of Parliament as Chancellor of the Exchequor George Osborne presented his budget in London June 22, 2010. Reuters

The final estimate of annual growth in the UK’s gross domestic product, or GDP, in the third quarter of 2013 was revised up 0.4 percentage points to 1.9 percent from the previously estimated 1.5 percent, confirming a steady recovery in Europe’s third-largest economy.

Third-quarter annual GDP growth was significantly higher than the 1.3 percent expansion seen in the previous quarter. On a quarterly basis, GDP grew 0.8 percent, unrevised from an earlier estimate and marginally higher than the 0.7 percent growth seen in the preceding quarter, data released on Friday by the Office of National Statistics showed.

Meanwhile, the UK’s current account deficit jumped to 20.7 billion pounds ($33.85 billion) in the third quarter from 6.2 billion pounds in the second quarter, widely missing expectations of a 13.85 billion pounds deficit and accounting for the largest share of GDP since 1989. The third-quarter deficit amounted to 5.1 percent of GDP at current market prices, up from 1.5 percent in the second quarter.

“So for now, the economy’s growth spurt seems to be exacerbating existing imbalances in the economy, rather than helping them to heal,” Samuel Tombs, UK economist at Capital Economics, said in a note.

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