UK: Economy continues to grow below its long run trend of 0.6% - NIESR

"Our monthly estimates of GDP suggest that output grew by 0.4 per cent in the three months ending in August 2017 after growth of 0.2 per cent in the three months to July," National Institute of Economic Research of the U.K. announced on Thursday.

Key takeaways:

• Our estimate is in line with our latest forecast for third quarter GDP which also stands at 0.4 per cent.
• Service sector output as well as industrial production appears to have contributed to the uptick in GDP growth. 
• Looking ahead into the second half of this year and beyond, we see the economy rebalance towards international trade in response to strengthening global growth and a weaker currency and away from domestic demand. 
• If indeed economic growth is sustained at the 0.4-0.5 per cent level, we prescribe a 25 basis point increase in Bank Rate in the first quarter of 2018