Unexpectedly, the UK economy expands by 0.1% due to strong services

LONDON (AP) — The U.K. economy grew unexpectedly in November as the tight job market increased demand for employment services and soccer’s World Cup boosted hospitality.

The gross domestic product, which is the broadest measure economic activity, increased 0.1% over the previous month, according to the Office for National Statistics. Economists had predicted a 0.2% contraction. This beat their expectations.

Despite better than expected figures, the ONS advises caution when estimating monthly GDP because they are more volatile that quarterly data.

Economists await the release of fourth quarter GDP data next month. This will reveal whether the British economy contracted from the second consecutive quarter in December. A recession is defined as two quarters of negative GDP growth.

November’s expansion was driven by a 2% growth in administrative and support activities, with employment services growing 2.1%, the ONS said. The British economy is 80% dominated by service industries.

Consumer-facing activities increased 0.4%. This was led by a 2.2% increase in food & beverage services, as the soccer World Cup got underway.

The ONS stated that growth in services offsets a 0.2% decrease in output from production industries.

The November manufacturing decline was 0.5%, while construction activity was stagnant.

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