GDP figure faces cut due to construction

Published on Thursday 16 December 2010 14:23

BRITAIN'S economic growth is set to be trimmed this week after an icy blast blew through the construction sector.

Revised data for the three months to the end of September is expected to confirm that GDP growth held up well at 0.8 per cent quarter-on-quarter.

However, economists have warned that the year-on-year figure may be cut to 2.7 per cent from 2.8 per cent due to downward revisions to construction output.

The Office for National Statistics has already downgraded construction growth in the second quarter and also revealed that the sector contracted more than previously reported in the opening months of 2010.

Until now, the GDP data has not factored in these downward revisions.

Howard Archer, chief UK economist at IHS Global Insight, the forecasting group, said it could wipe 0.2 per cent from Q2's bumper 1.2 per cent growth rate.

He added: "Economic activity seems likely to slow to around 0.5 per cent quarter-on-quarter in the fourth quarter. This would result in overall GDP growth of 1.8 per cent in 2010."