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UK economy expands by 0.5% in three months after Brexit vote


PanArmenian.Net
27 Oct 2016

PanARMENIAN.Net - The UK's service sector helped the economy to grow faster than expected in the three months after the Brexit vote, official figures have indicated, according to BBC News.

The economy expanded by 0.5% in the July-to-September period, according to the Office for National Statistics.

That was slower than the 0.7% rate in the previous quarter, but stronger than analysts' estimates of about 0.3%.

"There is little evidence of a pronounced effect in the immediate aftermath of the vote," the ONS said.

The stronger than expected growth will further dampen expectations that the Bank of England's Monetary Policy Committee will cut interest rates next week.

Welcoming the figures, the Chancellor of the Exchequer, Phillip Hammond said: "The fundamentals of the UK economy are strong and today's data show that the economy is resilient."

However, Labour's Shadow Treasury Minister, Jonathan Reynolds said: "Continued disappointing, sluggish growth shows the failures of the Tories' economic approach after six years in power, especially for the manufacturing sector which shows little sign of benefiting from lower sterling.

The economy was boosted by a particularly strong performance from the services sector, which grew by 0.8% in the quarter.

Transport, storage and communication was the strongest part of the service sector, growing by 2.2%. That was the fastest pace since 2009 and was helped by a healthy quarter for the UK's film industry. The latest films in the Jason Bourne and Star Trek franchises were released in July along with other popular productions, lifting takings at box offices.

ONS chief economist Jo Grice said "A strong performance in the dominant services industries continued to offset further falls in construction, while manufacturing continued to be broadly flat."

This is the first estimate of economic growth for the period, using less than half the data that will be used for the final estimate.

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