Kingdom has Growth in the last quarter

Divisions over whether the month points to underlying weakness in the UK economy, or was just a blip.

The UK economy came to a standstill in August, according to official data suggesting a slowdown in growth after the World Cup.

The National Institute of Statistics reported that the GDP growth rate in August fell from 0,4% to 0% in July, missing city economists' forecasts of 0%.

Analysts said momentum in the UK economy was slowing after robust growth at the start of the summer, when hot weather and the World Cup prompted consumers to spend more money.

They also warned that August's weak reading could serve as a warning sign for weaker economic growth in the coming months, amid growing concerns about the risks of a no-deal Brexit.

Despite the weaker performance in August, ongoing quarterly GDP revealed the strongest growth in almost two years, at 0,7% in the three months.

The ONS says monthly GDP readings can be volatile, with the potential to change significantly from one month to the next. Some economists, however, said the August figure may have revealed underlying weaknesses in the economy.

“It appears that the World Cup may have encouraged spending in July, but the party ended abruptly the following month,” said Azad Zangana, senior economist at Schroders.

“It could also be in response to rising fears about a no-deal or cliff-hanger Brexit… If the slowdown is Brexit-related, then it is likely to have persisted until September, and could last for a few more months still,” he added.

The latest UK growth report showed that the stagnation in August was largely in the economy, with only a modest improvement in the rate of production in the industrial sector, thanks to mining and quarrying activity.

The services sector, which accounts for more than four-fifths of the economy, recorded zero growth. Industrial production fell 0,2%, while construction production fell 0,7%.

Some economists said August could be a blip; Earlier this year, the UK economy ground to a halt amid cold weather, before recovering.

The National Institute for Economic and Social Research said it expects the UK economy to grow by 0,7% in the third quarter of 2018 and 0,5% in the final three months of the year, pointing to economic growth for the year as a whole. 1,5%.

John Hawksworth, chief economist at accounting group PricewaterhouseCoopers, said growth of around 1,5% a year is still below the pre-Brexit vote trend of 2%, with the growing risk of an EU exit continuing to loom. drag the activity.

“This looks likely to continue into the fourth quarter of 2018, when we expect some moderation in UK growth [amid Brexit uncertainty],” he added.

The ONS update came after the International Monetary Fund downgraded UK growth forecasts for this year. The global lender of last resort expects a growth rate of 1,1%, down from 1,3%, as Brexit uncertainty weighs more heavily on trade and investment.