–Q1 GDP Unrevised at +0.3% q/q; -0.2% y/y
–Q1 GDP In-line with median forecast
–NS says errors found during quality assurance checks minimal

LONDON (MNI) – UK economic growth in the first quarter was
unrevised while errors uncovered by National Statistics in the data were
minimal, figures released by National Statistics Monday showed.

Gross Domestic Product was unrevised to show a 0.3% on the quarter
in Q1 and was down 0.2% on the year, in line with the median forecast
from City economists.

Last month, statisticians at National Statistics uncovered errors
in the data causing a delay to the release of the data. A number of
commentators had speculated that any errors could have caused large
revisions to the data.

Possibly more important than the GDP release itself was news that
the index of services decline 0.3% on the month in April. With services
accounting for more than 75% of the economy, there needs to be a strong
bounceback in April and May if GDP growth in Q2 is going to live up to
the hopes of many, including the Bank of England.

There were some back revisions to GDP growth, although these were
due to the usual annual Blue Book changes and not the reported errors.
Most notably, growth in 2008 was revised down to show a fall of 0.1%
compared with 2007 from an initially estimated 0.5% increase. This was
the first back-to-back annual declines since 1980/81.

The revisions also mean that the recession was a little deeper than
initially estimated with peak to trough GDP now estimated to have
declined by 6.4% compared with the originally estimated 6.2%. The
economy, however, entered and left recession at the same time as
original estimates suggested.

During Q1 there were some small revisions to data with household
spending revised down to show a fall of 0.1% on the quarter from an
initially estimated flat outturn.

Gross fixed capital formation was also revised higher to show an
increase of 4.5% on the quarter compared with the initial 1.5% rise.

On the output side services growth was revised a little higher to
0.3% on the quarter from 0.2%.

The newly published saving ratio dipped to 6.9% in Q1 from 7.2% in
Q4 2009, having hit a recent peak at 8.5% in Q3 2009.

–London newsroom: 44 20 7634 1655; e-mail:drobinson@marketnews.com

[TOPICS: MABDS$,M$B$$$,MT$$$$]