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UK January Economic Growth Beats Forecast

The UK economy expanded at a faster-than-expected pace in January, supported by growth in all main sectors such as manufacturing, services and constructions, preliminary figures from the Office for National Statistics showed on Tuesday.

Gross domestic product grew 0.5 percent month-on-month in January after a 0.40 percent decline in December. Economists had expected a 0.20 percent increase.
In November, GDP grew 0.2 percent monthly.

On a 3-month-on-3-month basis, GDP rose 0.20 percent in January, which was in line with economists' expectations.

"Across the latest three months, growth remained weak with falls in manufacture of metal products, cars and construction repair work all dampening economic growth. These were offset by strong performances in wholesale, IT and health services," ONS Head of GDP Rob Kent-Smith said.

"This sluggish growth came despite the economy bouncing back from a weak December."

Industrial production rose 0.6 percent from December, when it fell 0.5 percent. Economists were looking for a 0.20 percent growth.

Manufacturing output grew 0.8 percent after a 0.7 percent decline in December. Economists had expected a 0.20 percent increase. The latest rise was the first since June 2018, and was mainly due to a surge in pharmaceuticals output.

Services output grew 0.3 percent after a 0.2 percent fall in the previous month. Economists had expected a 0.20 percent gain.

Construction rose 2.8 percent, reversing a similar size fall in December. Economists had forecast a 0.80 percent increase.

Separately, the ONS reported that the visible trade deficit in January widened to GBP 13.08 billion from GBP 10.89 billion a year ago. In December, the shortfall was GBP 12.68 billion. Economists had forecast a GBP 12.2 billion deficit.

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