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GDP growth allays recession fears… for now

THE economy grew 0.3 per cent in July, meaning the UK isn’t heading for a recession — at least for now.

Construction, manufacturing and the all-important services sector showed signs of growth, although when averaged out over the three months to July, GDP flatlined. The agricultural sector fell.

This was a marked improvement on the April to June quarter, however, when GDP fell 0.2 per cent. Successive quarterly drops mean the country is officially in recession.

Rob Kent-Smith, of the Office for National Statistics, said: ‘GDP growth was flat in the latest three months, with falls in construction and manufacturing.

‘While the largest part of the economy, the services sector, returned to growth in the month of July, the underlying picture shows services growth weakening through 2019.

‘The trade deficit narrowed due to falling imports, particularly unspecified goods (including non-monetary gold), chemicals and road vehicles in the three months to July.’

The latest ONS figures only go up to July, experts warned, before the latest wave of political uncertainty and a worldwide economic slowdown had kicked in. Howard Archer, chief economic adviser at the EY Item Club, said: ‘Disappointing survey evidence for August relating to manufacturing, construction and services activity as well as retail sales suggests that the economy is currently finding life challenging as it is hampered by serious uncertainties relating to Brexit, the domestic political situation and the global economy.’