"England's Economy Fell Short of Expectations in the Third Quarter"

UK Economy Sees Slow Growth in Third Quarter

The Office for National Statistics (ONS) has announced the growth figures for the third quarter of 2023. The report shows that the UK economy grew by only 0.1 percent compared to the previous quarter.

Why Were Market Expectations Not Met?

The general expectation in the markets was that the UK economy would grow by 0.2 percent in the third quarter, following a 0.3 percent growth in the second quarter. However, the third quarter figures fell short of these expectations.

Sectoral Growth and Contraction

Growth in the services sector was recorded at 0.2 percent, while the construction sector showed a growth of 0.1 percent. On the other hand, the manufacturing sector contracted by 0.5 percent.

Annual Growth and Monthly Contraction

In the third quarter of the year, the UK economy registered an annual growth of 1.3 percent. However, a monthly contraction of 0.1 percent was experienced in September.

Impact of the Cyber Attack

One of the reasons for the weak growth in the third quarter was the sharp decline of 28.6 percent in motor vehicle production in September. This was recorded as the largest decline since April 2020, when the COVID-19 pandemic began.

The ONS's statement emphasized that the Society of Motor Manufacturers and Traders (SMMT) reported that a cyber attack disrupted the production process of a major manufacturer. The luxury car manufacturer Jaguar Land Rover (JLR), owned by Tata Motors, had halted production for about 6 weeks due to a cyber attack in August. JLR began to ramp up production again at the beginning of October.

This cyber attack is estimated to have caused approximately 1.9 billion pounds in damage to the UK economy.