Britain’s economic growth slows sharply

Pound coins are seen in front of a displayed EU flag in this picture illustration taken January 18, 2017. REUTERS/Dado Ruvic/Illustration
Vastavam web: Britain’s economic growth slowed in the first quarter to the weakest pace in a year, official data showed Friday a blow for a nation facing heightened tensions over Brexit ahead of June’s general election.Gross domestic product expanded by 0.3 per cent in the three months to the end of March, compared with 0.7 per cent in the final quarter of 2016, the Office for National Statistics said in a statement.Analysts’ consensus forecast had been for first-quarter growth of 0.4 per cent, with the worse-than-expected result mainly attributable to a slowdown in services sector output, the ONS said.
“That is probably fair, albeit in an indirect sense. The fears leading up to Brexit were that growth would stall due to a dive in confidence, hiring and investment,” he said.”That hasn’t happened. What did happen is the pound dived, pushing inflation sharply higher and that is causing consumer spending and hence overall growth to slow,” Clarke added in a note to clients.The update comes as Britain awaits a general election on June 8 after Prime Minister Theresa May last week called for a snap vote.Tensions rose yesterday when May accused the other 27 EU countries of lining up to oppose Britain after Germany’s Angela Merkel said the UK should have no “illusions” over the exit process.
EU nation leaders have stressed a united stance as they plan to meet Saturday to set down the bloc’s “red lines” — although the talks will not begin until after the British election.EU President Donald Tusk has said Britain must first settle the key divorce issues of “people, money and Ireland” before any talks on a post-Brexit trade deal.In a letter to leaders of the remaining 27 European Union countries ahead of the summit on Saturday, Tusk said that “before discussing our future, we must first sort out our past.”