UK growth slows after big fall in car production

"But even when this is taken out, other sectors of the economy showed weak growth. While there was growth in services - which includes things like shops, restaurants, arts and entertainment and real estate - and construction, it was slower than in the previous quarter. Consumer spending growth remains weak and economists predict this could continue to weigh on growth for the rest of the year."

"In September alone, the economy contracted by 0.1% with the JLR cyber-attack having an impact. The cyber-attack began on 31 August, and resulted in one of the UK's largest car makers halting production for five weeks. The ONS said production output overall fell by 2% in September, and this was mainly caused by a 28.6% drop in car output following the attack."

"Some analysts said the weaker-than-expected growth figures had boosted the chance of a rate cut from the Bank of England next month. Rob Wood, chief UK economist at Pantheon Macroeconomics, said data "all but seals a December rate cut" when added to the weak jobs figures that came out earlier this week. For some businesses, the slow growth reflects the knock-on effect of last year's Budget, which raised National Insurance contributions for employers, as well as increasing the national living wage."

Growth in the UK economy slowed to 0.1% in the July-to-September period, below analyst forecasts. A cyber-attack on Jaguar Land Rover led to halted production and a 28.6% drop in car output, contributing to a 2% fall in overall production in September. Services and construction grew but at a slower pace than the previous quarter. Consumer spending growth remains weak and is expected to weigh on growth for the rest of the year. The weaker GDP data increased expectations of a Bank of England rate cut and reflected some business impacts from last year’s Budget measures, ahead of the upcoming Budget.

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