There are two sensible things to say about the UK economys third-quarter growth rate of 0.7%, announced today . The first is that it shows the economy is continuing to grow at a solid level. The second is that the rate of growth is down compared with the revised 0.9% in the second quarter. This slowing ought to bring a cautionary note to the current smugness of the domestic economic debate. But it is unlikely to do so.
Today, George Osborne boasted that, with annual growth up to around 3%, Britain is leading the G7 pack and said that the recovery is broadly based. In a few weeks time, when he delivers his autumn statement to MPs, Mr Osborne will trumpet more loudly the fact that Britains recovery has been even stronger than he first forecast in the budget. Thanks to a recent revision of real GDP growth figures by the Office for National Statistics, the UKs recent level of economic performance now looks better than it did. With the general election looming, the chancellor will undoubtedly seize on all these much-improved figures to burnish his economic credentials and as supporting proof for his deficit-reduction strategy. It is possible, indeed, that the argument may win the Conservatives the May election.
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