By Rob Starr, Content Manager, Big4.com
Chief economist John Hawksworth at PwC, comments on the preliminary Q4 2012 GDP figures recently released by saying that the GDP growth estimate of -0.3% in Q4 2012 was somewhat disappointing, but he felt that excluding the reversal of the Olympics-related boost to growth in Q3, it still indicates a broadly flat underlying trend in the economy.
“These are only preliminary estimates, however, and could be subject to later upward revision given that recent employment data, in particular, remain much stronger and the implied fall in productivity growth over the past 18 months looks implausibly large,” he said. “The apparent stagnation in 2012 also reflects particular weakness in North Sea oil and gas output (causing an 11% fall last year in the mining and quarrying sector of which it forms the largest part) and the construction sector (down over 9% last year), which we would not expect to be repeated to the same extent in 2013.”
The PwC economist also noted recent international data has also been somewhat more cheery, with China picking up in the fourth quarter, the US avoiding going over the fiscal cliff, and the eurozone crisis calming down a bit even if underlying problems there remain serious. This has helped to support a recent rally in world stock markets, suggesting a gradual return to cautious optimism about global prospects.