The Q3 GDP growth was revised downwards to 2.6% from 3.0% y/y. Several previous quarterly growth figures were revised somewhat downwards while the Q3 was unchanged at 0.7% q/q. Thus, there is still a strong growth momentum in the UK economy with household consumption being the main driving force.
The inflation has fallen significantly below the 2% target, mainly due to the sharp fall of oil prices. However, the healthy GDP growth supports our view that the Bank of England will start hiking rates at the middle of next year.
Nordea