UK economy grew 0.7pc says think tank

City A.M. Reporter
The UK economy grew strongly in the first three months of 2011, a major think tank has said.

The National Institute of Economic and Social Research (NIESR), which produces monthly GDP estimates, said that economic output rose 0.7 per cent in the first quarter of 2011 after a 0.5 per cent fall in the fourth quarter of 2010.

"This strong figure for the first quarter of this year is flattered by the economic impact of the adverse weather in the final quarter of last year," NIESR said.

"The underlying growth rate is weak. The average rate of growth in the final quarter of last year and first quarter of this year was 0.1 per cent," it added.

The first official estimate of Q1 GDP is due on April 27.

NIESR's estimate follows the release of unexpectedly weak February industrial output data, which caused some economists to scale back first-quarter growth expectations, and contrasted with Tuesday's strong service sector activity figures.