UK economy powering ahead
The UK economy grew at its quickest rate for two-and-a-half years during the last three months of 2006, helped by a strong demand for services, which expanded by 1% during the period.
Gross Domestic Product (GDP) went up 0.8% in the final quarter from the previous quarter, according to figures on the UK saving and investment arena released by the Office for National Statistics (ONS). Measured on an annual basis, GDP increased by 3% over the year.
The figures show that overall the UK economy grew by 2.70% last year, close to Gordon Brown’s projected figure of 2.75%, and well up from the 1.9% recorded in 2005, and making the economy a sound UK investment.
City analyst Simon Perry said: “This is good news for the economy, but I reckon the experts on the Bank of England’s Monetary Policy Committee (MPC) will be thinking of another interest rate hike in the light of the figures.”
The fast-growing service sector accounted for much of the growth and, in that sector, distribution, hotels, catering and retailers expanded by 1.8%, the fastest rate of growth for five years and representing a sound UK investment for investors.
To set against this, the industrial sector contracted 0.2% in the last quarter due mainly to the mild weather, with output for energy 2.3% lower than last time.