Translated from Indonesian to English - www.onlinedoctranslator.

com

NAME : DWIKI DIMAS PRADIPTA :

NIM 2001101010077

ENGLISH ECONOMIC GROWTH IS FOOLED FROM

ESTIMATION

London, CNBC Indonesia - The UK economy was weaker than previously

thought in 2017, according to official data released on Thursday (22/2/2018). This
makes the country lagging behind the pace of global recovery as it prepares to leave
the European Union (EU). The decline in full-year and fourth-quarter growth has also
raised questions about the strength of the country's economy as the Bank of England
(BoE) prepares to raise interest rates. Quarterly Gross Domestic Product (GDP) growth
slowed 0.4% from the previous forecast of 0.5%, bringing overall 2017 growth to 1.7%,
the lowest since 2012. This is still stronger than what economists feared soon after the
UK voted to leave the EU in 2016.

However, the country is still very dependent on the unpredictable global

economy to support its economic growth, while consumers are stuck in high inflation
caused by the fall of the pound sterling after Brexit. The British currency, the pound
sterling, was little changed after Thursday's data and government bond prices rose
slightly. Alan Clarke, economist at Scotiabank, said the figures suggest the UK
economy is growing at an unstable pace. The BoE sees a new pace with a slower pace
limit meaning a rate hike is still very likely. However, Samuel Tombs of Pantheon
Macroeconomics said the data suggested the central bank should hold off on any
action for now.
"Recent GDP data suggest that the economy is still in a fragile position and does
not need to be cooled by a rate hike as soon as May," he said in a note to clients.
Reuters. BoE Governor Mark Carney said interest rates may need to be raised faster
and higher than what the central bank expected in November, when it raised lending
rates for the first time in a decade. Most economists think that rates
interest rates will rise again in May, and financial markets predict a higher rise to 1% by
the end of the year.

England Lagging
UK economic growth on an annual basis (year-on-year/ yoy) was 1.4% in the last
three months of 2017 not only the weakest in five years, but also the weakest of all the
Group of Seven economies, as well as Japan and Italy. Investment was almost
unchanged on a quarterly basis and 2.1% higher on a yearly basis, lower than
economists polled by Reuters had predicted. Net trade growth dragged on almost all
quarters of 2017, although the numbers were positive on a yearly basis. The BoE
previously said it expects the economy to grow 1.8% this year, faster than its previous
projection of 1.6%. The reason is largely due to the strengthening of global
economists.