Industry NewsThe UK reported a slowing of its GDP in the second quarter of 2011. The latest figures from the Office of National Statistics (ONS) indicated an increase of 0.2 per cent compared to the 0.5 per cent last quarter. The reduction was attributed to a number of one-off factors such as the Royal Wedding and the Japanese tsunami. While the figures show growth, they remain at a low level.
The ONS commented that the special events in Q2 cut GDP in the services sector by 0.4 per cent and 0.1 in the production sector. This is the first estimate of this quarter's GDP. In addition, it was highlighted that an estimated 300 million pound was taken out of GDP by the Olympic ticket sales. This was an accounting rule issue, as while the first sales occurred in May 2011, they cannot be counted as part of GDP until the Olympics actually take place. For energy, it was highlighted that gas and power production had been cut by the warm weather during the quarter.
Commenting on the results, Chancellor George Osborne stated, "The positive news is that the British economy is continuing to grow and is creating jobs." He added, "And it is positive news too that at a time of real international instability we are a safe haven in the storm."
Nick Pearce, director of the Institute for Public Policy Research (IPPR) countered, "The UK economy might as well still be in recession, even if technically it isn't...Outside of London, in particular, the recession continues to be felt."