- GDP in Q4 2012: -0.3% on the quarter; flat on the year
- Manufacturing output: -1.5% on the quarter; -2% on the year
- Services output: flat on the quarter; +1.4% on the year
Commenting on the preliminary GDP figures for Q4 2012, published today by the ONS, David Kern, Chief Economist at the British Chambers of Commerce (BCC), said:
“The disappointing GDP figures could lead to renewed talk of a triple-dip recession, which could damage confidence. However, it is important to put this in perspective. The ONS figures for the third quarter were inflated by ticket sales for the Olympics, and this creates a downward distortion for the fourth quarter. The overall economic situation remains one of stagnation, which is clearly disappointing and needs to be remedied, but does not justify talk of recession. The figures show that the economy was flat in 2012, but if you exclude the effect of oil and gas, there has in fact been a small growth in GDP over the past year. Construction remains by far the weakest sector in the economy, with a year on year fall of 11%, which highlights the urgency of strengthening housebuilding and other infrastructure spending.
“Every effort must be made to minimise any harmful effect these figures may have on business confidence. We know from our own research that business confidence is still relatively strong, and though firms are adjusting to the reality of lower growth prospects, they are determined to do what they can to drive growth. To maintain credibility, the government must persevere with spending cuts in key areas, but be prepared to do more to support exports and investment to improve the supply potential of the economy.”
