UK economic growth remains at 0.4%, NIESR estimates

UK economic growth remained flat in the three months ending in November, according to a monthly estimate by the National Institute of Economic and Social Research.

NIESR said its estimate suggested gross domestic product grew by 0.4% in the three months ending in November 2016, as it did in the preceding three months to October.

The consensus estimate from economists had pointed to that same figure too.

“Recent economic growth has been driven almost entirely by the UK’s broad service sector, supported by robust consumer spending," said NIESR research fellow Rebecca Piggott.

"In stark contrast, the official figures suggest that the production and construction sectors of the economy have declined over recent months.

"Looking ahead, we do not expect such buoyant consumer spending growth to persist. Sterling’s pronounced depreciation this year is expected to pass through to the consumer prices throughout the course of 2017 and 2018, eroding the purchasing power of households substantially.”

Last week NIESR forecast GDP growth of 2% for 2016 and 1.4% in 2017, with CPI inflation expected to reach 3.8% at the end of next year.

Earlier on Wednesday, CMC analyst Michael Hewson said the NIESR estimate would be "expected to reinforce the continued resilience of the UK economy" by confirming a 0.4% expansion level.