GDP estimates show UK economy still growing after Brexit vote

Jake Cordell
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Sun shines on Gherkin and Canary Wharf, London skyline
The UK economy is still growing, despite the UK's Brexit vote (Source: Getty)

The UK economy is still on track to avoid a contraction in the crucial third quarter of the year, analysts at the National Institute of Economic and Social Research (Niesr) have argued.

The think tank's closely watched GDP estimates suggest the UK grew by 0.3 per cent in the three months to August. This marks a slowdown from the 0.4 per cent Niesr estimates the economy grew by in the three months to July, though it's still comfortably in positive territory.

Nevertheless, the group warned "the probability of a technical recession before the end of 2017 remains significantly elevated".

Niesr also believes the economy flat-lined in both July and August, meaning once pre-referendum activity in June falls out of the quarterly calculations, the growth rate could fall closer towards zero.

Strong economic data in the shape of retail sales and purchasing managers' indexes over recent weeks has prompted a number of forecasters to raise their outlook on the UK economy. Morgan Stanley and Credit Suisse, for instance, have both revised their predictions this week and no longer expect the UK to fall into a recession.