"Although third quarter growth of 1.2 per cent would still leave the economy 2.2 per cent smaller than its peak before the crisis, growth is clearly running much faster than the government and Bank anticipated earlier in the year."
- Chris Williamson, chief economist at Markit
During a period of several months Britain has emerged from falling into recession and managed to become one of the fastest growing economies in the developed world. The fact that all sectors of the economy posted solid growth, while the key services sector rose at the strongest pace for 16 years between July and September, is reinforcing a view the economy is on the path of sustain recovery. A pickup in services suggesting GDP growth would be 1.2% in the third quarter, level which last time was seen in a three-month period in the autumn of 2007. This rate of expansion is strong enough to outstrip such countries like the United States, France, Germany and even Brazil and India, which are two of the fastest growing BRICS economies. Even though this figure is significantly lower than the pre-crisis level, growth is still outpacing government's and BoE's projection, meaning in case such tendency persists Carney can avoid a review of his policy. Separately, property prices are seen to be rising at 6.2%, outpacing inflation rate by more than two times, on the back of imminent launch of the Help to Buy scheme, which is designed to lower credit costs and also aimed at healing the economy. Furthermore, employment recorded the fastest increase in six years, and economy's ability to create jobs is suggesting the unemployment rate can drop to its threshold earlier than expected. All these figures forced Vicky Redwood, chief UK economist at Capital Economics to upgrade his forecast for Q3 up to 1.3%.
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