LONDON (MNI) – The rate of UK growth in the three months through
April slowed from the first quarter, with the economy growing at below
trend rate, the National Institute of Economic and Social Research said
Wednesday.
NIESR said growth in the three months through April was 0.3%, down
from the 0.5% seen in the first quarter.
April output is likely to have been hit by the extra Royal Wedding
Bank Holiday, on April 29, which gave employees the chance to book an
extended break as it offered a link between the Easter Bank Holidays on
April 22 and the May 2 Bank Holiday but NIESR did not factor this into
its latest growth estimate.
“No explicit allowance has been made for the activities and
holidays associated with the Royal Wedding in the calculation of these
figures. Given this, today’s figures should be viewed as an estimate of
underlying economic growth in the UK economy,” NIESR said.
NIESR’s figures suggest the UK’s output gap is widening rather than
narrowing.
In the Bank of England Monetary Policy Committee’s May Inflation
Report, the central bank’s growth fan charts appeared to anticipate soft
growth in the second quarter, although it has yet to publish the
Report’s numerical parameters.
In a note economists at JP Morgan said “Our best attempt to
extricate a quarterly profile from the (BOE) charts suggests the MPC
have pencilled in an 0.3% q/q for 2Q (depressed by the Royal Wedding).”
The NIESR data suggest the economy has been running at this
subdued pace without even taking the Royal Wedding into account.
NIESR publishes each month growth estimates which run ahead of the
official figures.
–London bureau: +4420 7862 7491; email: drobinson@marketnews.com
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