Key Statistics: 6 Jan 2015

Construction

• The value of construction starts stalled in the final quarter of 2014, according to the January Glenigan Index. The index, which measures the construction value of all UK projects worth between £250,000 and £100m starting on site, was unchanged compared to a year earlier as a slowdown in civil engineering work offset expansion in the non-residential sector. The office and industrial building sectors were the brightest growth spots in the industry. By contrast the social housing sector showed a marked decline, offsetting a rise in the value of new private housing schemes.
• The number of mortgages approved for house purchases remained subdue in November at 59,029. This is 17% decline on a year ago and the lowest level since June 2013. The poor November performance maintains the weakening trend seen since last summer when the Bank of England tightened lending requirements.
• UK house price inflation continued to slow in December, according to Nationwide, with house prices increasing by 0.2% during the month to stand 7.2% on a year ago. This compares with an annual rate of 8.5% in November. Overall house prices increased by 7.2% over the course of 2014, after rising by 8.4% in 2013. 

Economy

• Revised official estimates of UK GDP paint a slightly less healthy picture of the UK economy than first thought. Figures from the Office for National Statistics (ONS) state that UK GDP in the third quarter of 2014 was 2.6% higher than the same quarter of the previous year, down from a 3% growth rate previously estimated. The rate of growth compared to the previous quarter was unchanged at 0.7%. The figures suggest that economic growth remains dependent on a relatively unstable base of consumer spending, which rose by 0.9% compared to the previous quarter, despite real incomes falling by 0.1%. By contrast business investment is estimated to have fallen back by 1.4% between the second and third quarters, though compared to a year earlier it grew by 5.2%.
• Manufacturing output growth softened during December, according the latest Markit/CIPS survey. The seasonally adjusted Markit/CIPS Purchasing Manager’s Index (PMI) edged lower to 52.5 in December, down from 53.3 in both October and November. Despite this slowing, December marked the 22nd month of uninterrupted expansion in both manufacturing production and new orders.
• National Statistics has downgraded its estimated of UK fixed investment in 2014 Q3.Overall investment is now estimated to have grown by just 0.1% during the quarter, but was 6.4% up on a year earlier. Within this total, business investment decreased by an estimated £0.6 billion (1.4%) compared with the previous quarter, but was 5.2% up on the same quarter a year ago. The downwards revision in business investment growth is largely due to a downwards revision to investment in buildings and other structures in Q3 2014, exacerbated by upwards revisions to transport equipment and buildings and other structures investment in the previous quarter (2014 Q2).
• The UK Service sector grew by 3.4% between October 2013 and October 2014, according to National Statistics. All of the four main components of the services industries increased in the compared with the same month a year ago, with the largest contribution coming from business services & finance.