The preliminary GDP estimate for the second quarter is released on 25 July. The current state of knowledge is as follows.
-
Industrial output, accounting for 14% of gross value added, was 0.2% above its first-quarter level in April / May. Assuming no change between May and June, the sector will add 0.03% to second-quarter GDP.
-
Services output, with a weight of 79%, was 0.4% above its first-quarter level in April. Retail trade accounts for 7% of services output and sales volume increased by 2.1% between April and May, implying a boost of 0.15%. The purchasing managers’ services activity index rose solidly in both May and June, with similar strength recorded in other surveys. Based on these considerations, services output may have grown by 0.6-0.7% in the second quarter, implying a GDP contribution of +0.48-0.56%. Private services turnover for May released on 19 July will provide further information.
-
Not-seasonally-adjusted construction output was 1.1% lower in April than a year before. Applying this change to the April 2012 reading of a provisional seasonally-adjusted series released by the Office for National Statistics in May suggests that April 2013 output was 3.4% above the first-quarter level. Assuming unchanged output in May and June, this would imply a GDP contribution of +0.19%, given the sector’s 6% weight. May seasonally-adjusted output together with a revised history will be released on 12 July and could significantly change this estimate.
The bottom line is that the data are tracking slightly below the forecast here of a 0.8-0.9% second-quarter GDP increase although the construction impact, in particular, is uncertain. The chart shows quarterly GDP levels together with a monthly estimate based on services, industrial and construction output data – the current April estimate is 0.55% above the first-quarter level.
