Spending and growth improve

A REBOUND in household spending and improved business investment helped the UK economy pick up pace in the third quarter of this year.

Growth rose to 0.4 per cent in the three months to September 30, up from 0.3 per cent in each of the previous two quarters.

Spending by consumers rose 0.6 per cent in the latest period – up from 0.2 per cent – in a sign shoppers are riding out the pay squeeze triggered by higher inflation. Business investment ticked up 0.2 per cent in the third quarter, climbing to £45.8billion.

The Office for National Statistics figures came as a separate study showed a rebound in retail sales. Around 3 per cent of shopping firms said sales have been higher this November than in the same month last year, while just 13 per cent said they were down. Retailers expect further improvement next month, according to the CBI. However, selling prices increased at their fastest rate in more than 26 years – suggesting pressure from inflation remains strong.