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| UK GDP 'close to pre-crisis level' says NIESR | UK GDP 'close to pre-crisis level' says NIESR |
| (35 minutes later) | |
| The UK economy is close to regaining its pre-financial crisis level of economic activity, according to research organisation NIESR. | The UK economy is close to regaining its pre-financial crisis level of economic activity, according to research organisation NIESR. |
| Economic output at the end of April was just 0.17% below its pre-recession peak, it said. | |
| Separately, official figures showed strong growth among manufacturers. | |
| Manufacturing output grew by 1.4% in the first quarter of the year, the strongest pace since 2010, the Office for National Statistics (ONS) said. | |
| Picking up pace | |
| The National Institute of Economic and Social Research (NIESR) said it expected GDP to regain its first quarter 2008 level within a short time scale. | |
| "It can reasonably be expected that the peak will be regained within the next month or so," NIESR said. | "It can reasonably be expected that the peak will be regained within the next month or so," NIESR said. |
| Separately, NIESR upgraded its growth forecast for the UK economy to 2.9% in 2014, from an earlier estimate of 2.5%. | |
| It increased its growth estimate for 2015 to 2.4% from 2.1%, and sees growth remaining at about 2.4% for the following two years. | It increased its growth estimate for 2015 to 2.4% from 2.1%, and sees growth remaining at about 2.4% for the following two years. |
| 'March of the makers' | 'March of the makers' |
| The better-than-expected rise in manufacturing output was mainly driven by rubber and plastics, which grew by 7.3%, ONS figures showed. | |
| Food, beverages and tobacco, and machinery and equipment also drove growth. The largest downward pressure came from pharmaceuticals, which fell by 5.8%. | Food, beverages and tobacco, and machinery and equipment also drove growth. The largest downward pressure came from pharmaceuticals, which fell by 5.8%. |
| Martin Beck, senior economic adviser to the EY ITEM Club, said: "The 'march of the makers' continues." | Martin Beck, senior economic adviser to the EY ITEM Club, said: "The 'march of the makers' continues." |
| He noted that given recent upbeat manufacturing surveys in April, the second quarter of the year seemed "set fair for further strong growth in the manufacturing sector". | He noted that given recent upbeat manufacturing surveys in April, the second quarter of the year seemed "set fair for further strong growth in the manufacturing sector". |
| In addition to the manufacturing data, separate figures from the ONS showed that output in the construction sector grew by 0.6% from the previous quarter. | |
| 'Slow' improvement | |
| The ONS also said that the UK trade deficit fell to £1.3bn in March. | |
| The fall in March's trade deficit was driven by a rise in exports, with exports of goods up 4.9% from the month before while imports of goods rose 2.8%. | The fall in March's trade deficit was driven by a rise in exports, with exports of goods up 4.9% from the month before while imports of goods rose 2.8%. |
| However, David Kern, chief economist at the British Chambers of Commerce noted that while the monthly figure had seen a big improvement, the trade deficit for the first quarter of 2014 had narrowed only slightly compared with the previous quarter. | However, David Kern, chief economist at the British Chambers of Commerce noted that while the monthly figure had seen a big improvement, the trade deficit for the first quarter of 2014 had narrowed only slightly compared with the previous quarter. |
| "While there are signs of a small improvement in the UK's international trade performance over time, the pace of change is still painfully slow," Mr Kern said. | "While there are signs of a small improvement in the UK's international trade performance over time, the pace of change is still painfully slow," Mr Kern said. |
| Nevertheless, the ONS figures suggest that the health of the economy is improving, BNP Paribas UK economist David Tinsley told the BBC. | |
| "The quarterly figures for industrial production, particularly manufacturing, suggest the economic upswing is continuing, if not accelerating," Mr Tinsley said. | "The quarterly figures for industrial production, particularly manufacturing, suggest the economic upswing is continuing, if not accelerating," Mr Tinsley said. |
| "This is a recovery not just based on the consumer. Manufacturing is powering ahead too." | "This is a recovery not just based on the consumer. Manufacturing is powering ahead too." |