The National Institute for Economic and Social Research (NIESR) said that the British economy grew by 0.7 percent over the quarter to the end of January, an increase of 0.1 percentage point over the three months to December and stronger still than the 0.5 percent increase over the three months to the end of November.
According to NIESR, the economy grew 0.6 percent in the fourth quarter of 2016, giving an annual growth rate of 2 percent.
The resilience of the UK economy since the Brexit referendum in June has largely been supported by robust expansion in real consumer spending, NIESR said.
The prospects for 2017 are good, with the strong consumer spending of last year carrying over into the first month of this year.
NIESR forecast that rising inflation will push consumer price inflation sharply upwards from its current 1.6 percent (the latest figures, from December), already sharply increased from November’s 1.2 percent.
CPI is forecast to reach 3.3 percent this year, dropping only slightly to 2.9 percent in 2018.
This is largely due to upward pressures from the sharp fall in sterling against other currencies in the aftermath of the Brexit vote.
The resulting rise in import costs and the weaker value of the pound in consumers’ pockets are expected to reduce the rate of growth and NIESR forecasts 2017 growth at 1.7 percent.
China will welcome British Prime Minister Theresa May at an appropriate time, Foreign Ministry spokesperson Lu Kang said on Wednesday, providing no details about the timing of the visit.
May’s spokeswoman was quoted by Reuters as saying May will make a visit this year, the latest of her trips to major trading powers as she negotiates Britain’s divorce from the EU.
“We are willing to work with Britain to advance sustainable, healthy and stable development of the China-Britain global comprehensive strategic partnership for the 21st century,” Lu said.
The spokesperson said China believes Britain and the EU will negotiate a “win-win” deal.