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Economic growth slows in US and UK in Q1

by ChemOrbis Editorial Team -
  • 04/05/2017 (23:56)
According to data from the US Commerce Department, the US GDP was up by 0.7% quarter-on-quarter in Q1 of 2017 after an increase of 2.1% in the previous quarter and stood below the economists’ forecasts which called for a rise of 1.2%. This was recorded as the country’s worst economic performance since Q1 of 2014, when the GDP increased by 1.2%.

This slowdown was thought to be driven by consumer spending which lost momentum to 0.3% in Q1 from a rise of 3.5% in Q4. This was caused by the decreases in motor vehicle sales, utilities spending as well as private inventory investment, and state and local government spending. However, the slowdown was limited by an increase in exports, and residential and non-residential fixed investment.

Similarly, the UK’s GDP increased at the slowest pace in a year in Q1 by 0.3% when compared to the previous quarter, the data from the Office for National Statistics (ONS) showed. The growth rate in Q1 was slower than that of 0.7% in Q4 of 2016 and the expectations which called for an increase of 0.4%. The economy also grew by 2.1% on a yearly basis from 1.9% in the previous quarter.

The data showed that the slowdown in the country’s economy was driven by an increase of only 0.3% in the services sector from 0.8% in the previous quarter, a slowdown in total production at 0.3% from 0.4% from Q4 of 2016 as well as a decrease in construction output, which increased slightly by 0.2% in Q1 after a rise of 1% in the previous quarter.
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