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GDP grows by 0.8% in third quarter

GDP increased by 0.8 per cent in the third quarter of 2010, which is unrevised from the previous estimate, according to the Office of National Statistics.

It means GDP is now 2.8 per cent higher than in the third quarter of 2009.

Out put in the services industry remained unrevised at 0.6 per cent in the latest quarter, which is the same as the increase in the previous quarter. Growth was driven in the third quarter by a rise of 1.4 per cent in transport, storage and communications services. Distribution, hotels, catering and repairs grew by 0.9 per cent, and business and finance grew by 0.3 per cent.

Output of the production industries remained unrevised at 0.6 per cent and, within production, manufacturing output increased by 1 per cent. But mining and quarrying output fell by 1 per cent. Construction output rose by 4 per cent.

Household expenditure rose 0.3 per cent following a rise of 0.7 per cent in the second quarter of 2010.

Government final consumption expenditure rose by 0.4 per cent and is now 2.8 per cent higher than the third quarter of 2009.

In the third quarter of 2010 the trade deficit in real terms decreased to £9.7bn from £10.9bn. Exports of goods and services rose 2.2 per cent whilst imports rose 0.7 per cent.

Currency Solution director Christina Weisz says: “Today’s data will reassure markets that the UK is less likely to need further quantitative easing and, relative to the US, is at least moving in the right direction. Unfortunately for the UK and Sterling, many obstacles still lie ahead.”

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