Stories surrounding the effects of Brexit on the country’s economy have largely focused on the negatives, but the most recent official statistics have revealed a somewhat different situation…
Last week, the latest figures from the Office for National Statistics (ONS) showed that the final quarter of 2017 registered an upturn in investment across the whole economy, to a total of £84.1bn – which is a quarterly rise of 1.1%, and an annual increase of 4%.
Despite the general market sentiment that investment has slowed down due to increased caution in the market since the Brexit vote, the UK’s results were actually higher than any other country in the G7, with Italy in second place with a 3.7% annual growth, followed by France with 3.5%.
Construction spending is still rising
The ONS’s figures look at gross fixed capital formation (GFCF), which is the measure used to cover all investment including the public and private sectors, manufacturing, construction, services and extractive industries. Business investment increased by 2.6% between Q4 2016 and Q4 2017, to £46.2bn, and saw a quarter-on-quarter rise of 0.3%.
With buildings and construction accounting for approximately half of all investment spending in the UK’s service economy, both commercial and residential investment have made a significant contribution to the overall rise. On an annual basis, the ONS figures show that private sector housing investment increased by around 1.1% in the final quarter of last year, and by around 0.2% compared to the third quarter.
Infrastructure spending also saw a boost over the course of last year, a large part of which was associated with the new High Speed railway (HS2) plans which are now underway, and are set to transform a number of areas across the country. Click here for the full ONS figures.