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UK lags behind EU economic growth in Q3

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EU economic growth was estimated to have increased by 0.6% in the third quarter as opposed to the UK’s 0.4%.

The Eurostat figures show the differences in fortunes between Britain and the single currency area during Brexit talks. The 19 members grew 0.2% faster in the three months to September this year.

Eurozone GDP growth of 0.7% in the second quarter of 2017 was ahead of the UK’s 0.3% growth, the weakest rate in the G7.

This has been attributed to factors such as weak investment and potential opportunities across the continent post-Brexit.

Inflation in the UK also grew to 3% last month, the highest since 2012.

Confidence in UK housing sector hits half-decade low

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The Halifax bank survey showed 20% of people think house prices will drop because of rising inflation and the potential of an increase in interest rates.

This is the weakest reading since October 2017 and people under the age of 25 and living in London are the least optimistic. Correlated alongside this is the weak growth in wages, rising inflation rates, and for the first time in a decade, the Bank of England being set to increase interest rates.

The survey, which took in 2,000 British adults, saw two-thirds stating obtaining a deposit as the greatest barrier to buying a new house. Job security was also a major worry. £222,293 was the average price of a house in the UK in August.

Not surprisingly London was the only area with an entirely negative outlook to purchasing right now. The ages of 16 to 24 were the most pessimistic about buying; over 65 was the most positive group surveyed.

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UK car manufacturing falters in September

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The fall in UK car manufacturing was predominantly attributed to an overall fall in demand of 14% in the UK market.

UK car output fell 4.1% to 153,224 vehicles last month. The months of April, May, June and August also saw declines.

Domestic demand declined by a large sum to 31,421 units (14.2%) in September. This contributes to the overall year-to-date production decrease of 2.2%. Alongside this, exports dropped by 1.1% to 121,803.

The first nine months of 2017 has seen 1,259,509 cars manufactured, a decline of 2.2% when compared with last year.

With many looking towards more environmentally-friendly modes of transport and the advent of the e-car, the traditional British car manufacturers are unsurprisingly taking a hit. The beginning of this week saw Mayor Sadiq Khan introduce the toxicity charge (T-charge) to encourage people to drive less polluting cars. This will add to the already-existing £11.50 congestion charge.

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UK economy beats 2017 third-quarter expectations

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The British economy grew by 0.4% in the third quarter but difficulties still lie in the current Brexit landscape.

Gross domestic product (GDP) grew 0.4% from the period July to September, which is up from the 0.3% of the last quarter and 0.1% higher than initially expected, according to the Office for National Statistics figures.

This small growth will boost the chances of the Bank of England’s Monetary Policy Committee raising interest rates when members meet next week.

However, the economy is growing at a slower pace than it was last year. Manufacturing had a slow second quarter but jumped to boost third-quarter figures even with construction slumping to a second-quarter loss in a row. But the greatest contributor to growth during this period was the service sector, which expanded by 0.4% in itself.

Last quarter’s 0.3% growth was only half that of the 19-member eurozone and the lowest amongst the G7 nations.

The new figures shed light on the potential to a rise in rates which, if to occur, would be the first time a rates rise has happened in the UK since July 2007.

Costa losing out to expensive imports and artisan competitors

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The coffee giant’s pre-tax profits dropped around 10% to £59 million.

Whitbread, Costa’s owner, saw group profits rise by 20% to £316 million thanks to its Premier Inn hotel business and a sales growth of 7% to £1.7 billion.

Coffee imports have become more expensive as the product is priced in dollars. This is also due to the fall in the value of sterling.

In the six months to 31 August, Costa’s revenues increased by 8% but this was largely down to the introduction of 108 new stores.

The Premier Inn Hotel saw profits rise by 27% to £295 million due to the addition of 2,000 rooms. It’s also looking to add eight new hotels in Germany.

Costa hopes that the “third wave of coffee” will help boost sales. With more artisan coffee producers reeling in young consumer, the British coffee giant will look into producing a more sophisticated and high-calibre quality of coffee.