A raft of gloomy survey data has fuelled fears that the UK’s economic recovery is running out of steam. There are some indications that quarterly GDP growth will moderate from 0.7% in Q2 to 0.5% or so in Q3 – a fairly respectable figure, but certainly not one that is going to prompt the MPC to rush into raising interest rates soon.
While disappointing, growth of 0.5% is broadly in line with the UK’s historical average and hardly a disaster. And with the domestic economy still strong and global fears likely to be overdone, we doubt this signals that the economic recovery is running out of steam.
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