Tuesday, 30 June 2009

DATA SNAP: UK Business Investment Slumped In 1Q

DATA SNAP: UK Business Investment Slumped In 1Q

By Paul Hannon

Of DOW JONES NEWSWIRES

LONDON (Dow Jones)--Business investment in the U.K. fell 7.6% in the first quarter from the previous quarter, and dropped 9.7% on the year, the Office for National Statistics said Tuesday.

The decline in investment was larger than the ONS had first estimated. Last month, it calculated that investment fell by 5.5% on the quarter and 6.8% on the year.

The fact that investment was weaker than thought in the first three months of the year contributed to a sharp downward revision in the ONS' estimate of gross domestic product over the period. The statistics agency Tuesday said it now calculates that GDP fell by 2.4% in the first quarter, having previously estimated that it fell by 1.9%.

The first-quarter decline in business investment was the sharpest quarterly drop since the second quarter of 1985. The ONS said investment by manufacturers fell by 4.2% from the fourth quarter, and was down 1.5% on the first quarter of 2008.

Investment by service providers outside the retail and distributive sector fell by 9.4% on the quarter and 13.2% on the year, while investment by construction companies fell by 14% on the quarter and 48.3% on the year.

-Paul Hannon, Dow Jones Newswires, +44 20 7842 9491, paul.hannon@dowjones.com

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(END) Dow Jones Newswires

June 30, 2009 04:36 ET (08:36 GMT)


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