• GDP in Q3 up 0.5% on the quarter, up 0.5% on the year
Commenting on the preliminary figures for the third quarter of 2011, published today by the ONS, David Kern, Chief Economist at the British Chambers of Commerce (BCC), said:
“The figures for Q3 are better than expected, though they follow particularly disappointing 0.1% growth in the previous quarter, which was affected by special factors. Over the last year growth has been relatively weak at only 0.5%, but it is reassuring that fears of a recession have so far been unfounded. There are still risks ahead. Early indications from the fourth quarter are concerning, and if the situation in the Eurozone worsens there could be serious adverse repercussions for the UK.
“It is right for the government to persevere with reducing the deficit, and calls for a Plan B are unjustified. But there is a clear need to reallocate priorities within the current spending envelope to support business growth.
“The government must make use of the considerable flexibility within its current fiscal plan. The Autumn Statement at the end of this month provides a real opportunity for the Chancellor to remove obstacles facing businesses, and take additional measures to improve the flow of credit to companies, particularly SMEs. The MPC must persevere with its current expansionary policies and reassess its reluctance to engage in credit easing policies.”