GEORGE OSBORNE, Britain’s chancellor of the exchequer, has long crowed that the economy he presides over is one of the fastest-growing in the rich world. But GDP figures, published today, have given some cause for concern. They show that in the third quarter Britain’s economy grew by just 0.5% (2% in annualised terms), down from 0.9% last year.
The slowdown may be due to the strong pound. The manufacturing sector, which makes up about one-tenth of GDP, is really suffering: it has probably been in recession for the past nine months. Even services, which are not so affected by a dear currency, are not doing so well: services output increased by just 0.7%.
Growth of 0.5% probably pushes back the timing of the first interest-rate rise since 2007. In a speech over the summer, Mark Carney, the governor of the Bank of England, said that at a quarterly growth rate of 0.6% the remaining "slack" in the economy would soon be squeezed out. Today's...Continue reading
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