Commenting on the Office for National Statistics’ preliminary estimate that UK Gross Domestic Product increased by 0.6 percent in the second quarter of 2013, compared with the previous quarter, KPMG Chief Economist, Andrew Smith, said:
“Sunshine, sporting success, a Royal baby and now some economic news to celebrate too. Confirmation that output has expanded for two consecutive quarters raises hopes that after a number of false dawns, the economy is finally gaining some momentum. The recovery has got to start somewhere.
“Yet, it remains vulnerable. Consumers are constrained by falling real wages and high levels of debt, austerity measures continue to sap, rather than support, growth and the European export market remains sluggish at best. Maintaining traction may require more support from the Bank of England which is widely expected to provide it in the form of forward guidance at the next Monetary Policy Committee meeting.
“Nevertheless it would be churlish not to acknowledge that 2013 is going well, in the context of the insipid performance of the past few years. And, for once, the forecasts made in this year’s Budget will likely be revised up rather than down – indeed, this year, we could see around double the 0.6 percent growth predicted in March. For now then, the economy, whilst not exactly back to the races is certainly back on the track.”
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Notes to editors
KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and operates from 22 offices across the UK with over 12,000 partners and staff. The UK firm recorded a turnover of £1.8 billion in the year ended September 2012. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. We operate in 156 countries and have 152,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. KPMG International provides no client services.