May 2016 Scottish Economy Nowcasts

Today (3rd May 2016) we release our latest series of nowcasts of the Scottish economy; these are our latest estimate of the growth in 2016 Q1 and our first estimates for 2016 Q2 [1].

Headlines:

  • 2016 Q1 GDP growth in Scotland, at an annualised rate, is nowcast to be 1.17%, the quarterly change is nowcast to be 0.29%
  • 2016 Q2 GDP growth in Scotland, at an annualised rate, is nowcast to be 1.49%, the quarterly change is nowcast to be 0.37%

These nowcasts represent a continued downward revision for 2016 Q1, and an indication that the economic malaise in Scotland is continuing through Q2 2016. Recall though that these first estimates for Q2 do not use any data on Q2 itself (the first data for April will be released during May and used in our next nowcasts).

In our last blog post, we indicated that by the time of this blog we would have received official data on growth in Q4 of 2015. In addition, with the release of the Q4 data, we received a revised series of GDP data including revisions to Q3 2015 which resulted in the emergence of an economic contraction in contrast to the previous estimate for Q3 of muted growth. The effect of using these revised data is reflected in the downward revision to our estimates for 2016 Q1.

The Scottish economy is really struggling, both in relative (to the UK) and absolute terms. That so little focus has been given to this reality in the ongoing election campaign is puzzling. Nevertheless, it is important that the incoming Scottish Parliament give immediate attention to the ongoing economic torpor in Scotland, and give fresh impetus to efforts to boost Scottish economic growth.

For details of how the data mentioned above, and other “live” data on Scottish economic activity are used to construct our “nowcasts”, see the Methodology page.


[1] Note as explained in the methodological paper (here), we nowcast gross value added (GVA) rather than gross domestic product (GDP), because this is the regional equivalent of GDP which is produced, but we refer here to GDP for intuitive ease.

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