A second estimate from the Office of National Statistics has concurred with the first that between April and June of 2011 the UK economy grew by 0.2%. The rate of growth was limited in the second quarter as a result of an extra bank holiday and the tsunami in Japan which disrupted car part imports.
Figures from the second quarter of 2011 also showed that whilst the service output rose by 0.5%, industrial output fell by 1.6%. In addition, despite the one off events that restricted economic growth in the second three months of the year, the economy was still 0.7% bigger than it was in the second quarter of 2010. The Office of National Statistics has estimated that if economic growth had not been limited by such as the extra bank holiday, the difference between the first and second quarters of 2011 would have been an increase of 0/7% as opposed to 0.2%.
The slow rate of economic growth in the UK is partly due to a decrease in consumer spending which is the result of job cuts, rising prices and fewer pay rises.
The government had aimed to keep inflation at no more than 2% however, in July the Consumer Prices Index measured inflation at 4.4%, an increase from the 4.2% that was measured in the month previous. In addition, figures from June showed the number of people unemployed stood at 2.49 million compared with 38,000 between March and May.
Economist Philip Shaw has revealed that the UK economic growth is expected to do improve this third quarter as there is no planned one off events which could slow growth. However, he has made it clear that there still remains the possibility that growth will continue to slow, however unlikely.
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