Mixed news on the UK growth outlook

A strong outturn for November took the output measure of GDP above its pre-pandemic peak. Given GDP is likely to have fallen in December, the quarterly version probably didn’t pass this landmark in Q4. However, timely data suggests the hit from Omicron will be small and relatively short-lived.

What you will learn:

• But the long-term outlook appears softer in light of the new ONS population projections.
• The ONS now expects lower births and higher deaths, putting more emphasis on immigration to grow the UK workforce.
• The revisions imply softer growth in potential output, with the level of GDP in 2050 set to be 1.5ppt lower.