Fears of weak second quarter for economy as car production lull takes toll
Growth in the British economy slowed in the three months to April, as a drop in car production following the original Brexit deadline hit output.
Gross domestic product (GDP) was up by 0.3 per cent in the three months to April, according to the Office for National Statistics (ONS).
This marked a slowdown on the rolling three-month level for January to March, when growth was at 0.5 percent thanks to the highest quarterly pick-up in manufacturing since the 1980s.
On a month-to-month basis, GDP contracted by 0.4 per cent in April, faster than the 0.1 per cent decline expected by economists.
This was due to a drop in car manufacturing after several automobile plants went ahead with planned shutdowns, which had originally been scheduled to coincide with the immediate aftermath of Brexit.
Rob Kent-smith, the ONS’S head of GDP, flagged “wide - spread weakness across manufacturing in April, as the boost from the early completion of orders ahead of the UK’S original EU departure date has faded”. Meanwhile, the ser vices sector recorded its lowest three-month growth since this time last year, climbing just 0.2 per cent. Construction was up 0.4 per cent in the same period, boosted by strong growth in infrastructure.
Howard Archer, chief eco - nomic adviser at EY Item Club, said the latest figures indicated that the economy is heading for a weak second quarter: “We had been expecting GDP growth to be no more than 0.2 per cent quarter on quarter in the second quarter but even this mu ted performance is now looking somewhat optimistic.” He also highlighted the impact of “prolonged Brexit uncertainties, a fraught UK political situation and a challenging global economic environment”.