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UK GDP growth momentum stable in November

Staff Writer |
UK economic growth sustained its momentum in the three months to November, supported by the service sector and industrial production, the National Institute of Economic and Social Research said.

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The economy expanded 0.5% in the three months to November, similar to the September quarter, the think tank said, citing its monthly GDP estimate.

Official data showed that the gross domestic production grew 0.4% in the third quarter.

The NIESR has forecast real GDP growth of 0.5% for the final three months of the year.

NIESR Head of UK Macroeconomic Research Amit Kara described the UK monthly GDP growth of 0.5% as "somewhat higher than the economy's speed limit".

"If, as we expect, the economy continues to expand around this pace and inflation remains elevated, there is a case for the Bank of England to gradually raise the policy rate to stop the economy from overheating," Kara said.

"Consistent with that view, our latest forecast for the UK is conditioned on a 25 basis points increase in Bank Rate every six months such that the policy rate reaches 2% in 2021".

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