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Osborne says UK economy 'on the mend'

The Chancellor said the UK's beleaguered economy is finally "on the mend" as official figures showed a second successive quarter of growth.

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Clegg: 'Figures show we are on the road to recovery'

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Nick Clegg: Today’s #GDP figures show we are firmly on the road to economic recovery #economy #growth #jobs

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Nick Clegg: We must continue to work hard to build a stronger economy and do it fairly. #economy #growth #jobs #GDP

Labour: 'This is no recovery at all' for many across UK

After three damaging years of flatlining, it's both welcome and long overdue that our economy is growing again.

But for millions of people across the country still seeing prices rising faster than their wages this is no recovery at all.

Working people are on average over £1500 a year worse off since David Cameron came to office, yet very high earners have enjoyed a huge tax cut. And on the cost of living, growth and the deficit, this Government have failed every test they set themselves in 2010.

We now need action to secure a strong, balanced and sustainable recovery that works for the many, not just a few at the top. And simply to catch up all the lost ground since 2010 we would need 1.5 per cent growth in every quarter between now and the election.

– Ed Balls, Shadow Chancellor

Read: In figures - UK's economy growth fastest since 2010

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In figures: UK's economy growth fastest since 2010

The UK economy grew at its fastest pace for three years in the third quarter as GDP rose by 0.8%.

Here is a closer look at today's figures:

  • It was the third successive period of improving output.
  • The 0.8% GDP rise is the best performance since the second quarter of 2010.
  • The figures saw all sectors of the economy grow, including a 2.5% surge in construction - a sector bolstered by the Help to Buy initiative.
  • Overall GDP was 1.5% ahead of the same period last year.
  • However, the economy remains 2.5% off its pre-recession peak at the start of 2008 and construction remains 12.5% of its pre-crisis peak.
  • Production grew by 0.5% and manufacturing by 0.9%.

Britain's economy has grown by 1.9% since last year

Graphs showing Britain's economic outlook have been released by the Treasury.

An image on Flickr shows the UK economy has grown by 1.9% since the end of last year. Credit: HM Treasury / Flickr
The growth revisions for 2013 by the International Monetary Fund. Credit: HM Treasury / Flickr
The UK's manufacturing activity was the highest in the G7 in September. Credit: HM Treasury / Flickr

Read: Growth is weak but better than had been expected

Treasury: Recovery 'now has real momentum'

A Treasury spokesperson said the economic recovery "now has real momentum".

Today's GDP figures show that Britain's hard work is paying off and the country is on the path to prosperity.

Many risks remain, but thanks to our economic plan the recovery now has real momentum.

All parts of the economy are growing, the deficit is falling and jobs are being created - and that's the only sustainable way to raise living standards for hardworking families.

– HM Treasury spokesperson

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GDP predicted to increase between 0.8% and 1%

Growth of 0.8% would be the strongest level recorded for three years and some experts think it could be nearer 1%, amid buoyant survey data from a number of sectors.

Investec's Philip Shaw forecasts 0.8% growth for the third quarter but said it was "not impossible" that this could be closer to 1%.

Analysts at Scotiabank predict a reading of close to 1% - lying somewhere between "spectacular" survey data suggesting growth of up to 1.5% and official figures pointing to expansion of as little as 0.5%.

Mark Carney warns recovery in London and South East is 'not enough'

Howard Archer, of IHS Global Insight, predicts GDP growth of 0.8%, the strongest since the second quarter of 2010, when a 1% improvement was recorded.

He said domestic demand may have risen by around 1% for the third quarter of 2013 but will have been tempered by disappointing net trade and industrial production figures.

Social dangers hidden beneath uneven UK growth

by - Economics Editor

The dangers of uneven growth across the country include those that are social. We know the impact of long-term unemployment in places like the North East, which has been the very slowest to recover. Although the region has been recovering and growing this year.

The other danger is the difficulty of managing an economy that has hotspots, which the Bank of England may want to control by raising interest rates.

But that would have the effect of killing off the recovery in an area that is struggling. While London dominates, the North West is still doing very well.

There are signs that growth and the confidence that come with it are edging back right across the economy. We get the first estimates of growth tomorrow. The betting amongst economists is 0.8 per cent growth. That's better than expected at the beginning of the year, but it is still weak.

Read: Energy price rises 'significant'

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