Public CompanyUK economic contraction slows; GDP falls 0.7% in Q2
The recession-hit British economy shrank less than expected at 0.7 per cent in the second quarter of this year, indicating that the worst of the financial turmoil could well be over for the country.
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Spurring hopes that the country is on the path of economic revival, the GDP contraction is lower than the earlier second-quarter projection of 0.8 per cent.
In the first quarter, the UK GDP declined at a staggering pace of 2.4 per cent, the most in 51 years."Gross Domestic Product (GDP) contracted by 0.7 per cent in the second quarter of 2009.
"This has been revised from a fall of 0.8 per cent in the preliminary estimate of GDP, due to upward revisions to production. GDP is 5.5 per cent lower than the second quarter of 2008," UK"s Office for National Statistics said in a statement today.
The improvement in the economy for the second quarter was mainly due to better output of production industries and manufacturing industries.
According to the statement, output of the production industries fell by 0.6 per cent compared with a fall of 5.1 per cent in the previous quarter.
Meanwhile, "Output of manufacturing industries falling by 0.2 per cent compared with a fall of 5.5 per cent in the previous quarter". One of the worst hit by the raging financial turmoil, the UK has seen massive job losses and falling corporate profits in recent times.
The government has come up with various measures to boost the sagging economy, such as pumping in capital into financial services entities and guaranteeing toxic assets.
For the second quarter, trade deficit dropped to 7.3 billion pounds from 8 billion pounds in the first quarter.
The UK GDP figures comes amid increasing signs of an early economic recovery, especially after industrialised nations — Germany, France and Japan — exited recession, earlier this month.
Yesterday, official data showed that the American economy contracted much less than expected at one per cent in the second quarter of 2009. In the first three months of this year, the GDP had dropped 6.4 per cent.