Ward: Encouraging news for the UK economy

Henderson's chief economist Simon Ward outlines the leading indicators pointing to recovery in the UK economy.

A weighted average of services and industrial output rose by 1.2% in January, more than offsetting December's 0.8% weather-driven fall - see first chart. The January level of output was equal to September's recovery high and 0.7% above the fourth quarter average. Overall GDP, however, was depressed by a surprise further 9% fall in construction output in January following a 16% December plunge. GDP is estimated to have increased by only 0.6% after a 1.8% fall in December to stand 0.5% below its fourth-quarter average - first chart. Fortunately, construction weakness probably reflects c...