Andy Bruce and William Schomberg

LONDON, (Reuters) – The UK’s economy grew 0.6% in September. However, previous month estimates were less accurate. This means that GDP is 0.6% lower than what it was in February 2020. That happened just before Britain entered its COVID-19 lockdown.

Data showed that the economy was losing momentum after lockdown due to supply chain issues and businesses’ caution.

Reuters polled economic experts and forecast 0.4% growth in September’s gross domestic products.

The Office for National Statistics reported that July GDP declined by 0.2%. That is more than the previously calculated fall of 0.1%. Meanwhile, August output rose by only 0.2%. This was lower than what had been originally reported at 0.4%.

Suren Thiru of the British Chambers of Commerce said that even though the quarterly output rose from July’s contraction it is likely this was due to a temporary lift from economic restrictions rather than an improvement.

The September growth was aided by a stronger output from the health sector, as more people returned to their doctors following the pandemic. This resulted in a 0.7% increase in services sector since August.

However, industrial output declined by 0.4% while gas distribution contracted for the fourth consecutive month.

As a group, GDP rose by 1.3% for the third quarter. It was the weakest growth in three months since Britain’s lockdown of early 2021. According to the Bank of England, and the Reuters survey of economists, an increase of 1.5% was expected.

The fifth-largest economy in the world shrank by almost 10% in 2020. However, the International Monetary Fund predicts it to experience the fastest growth of any Group of Seven member country by 2021. This is compared to 6.8% expected.

However, the rapid recovery from lockdown in spring was followed by slower growth during the summer, due to rising COVID-19, problems with global supply chains, and some worker shortages after Brexit.

As it maintained interest rates at zero, the BoE declared last week that recent economic growth had been slower than anticipated. The BoE would also keep an open eye on the situation of the labour force after Oct. 1’s end to the government’s job protection program.

Separate data revealed that Britain’s goods trade deficit increased by 9 billion livres in the third quarter, to 42.3 billion pounds. This was due to rising imports from EU countries and non-EU nations as well as falling exports – particularly to non-EU states.