Economic activity speeds up in August

GDP reading: GDP grew 0.2% in month-on-month seasonally adjusted terms in August, following July’s flat reading and in line with market expectations. On a rolling quarterly basis, GDP rose at a more moderate pace of 0.2% in June–August (May–July: +0.3% qoq), the worst result since the three months up to January.

Drivers: Expansions in industrial output, construction and services all boosted GDP in August.

Panelist insight: On the economy, ING’s James Smith said: “The bottom line is that the economy still seems to be growing at a reasonable pace, but the 0.6/0.7% quarterly GDP readings we became accustomed to in the first two quarters of the year are not going to be repeated in the second half of the year. We’re looking for 0.2% growth in the third quarter overall.”

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