Recovery strengthens and broadens

The economic recovery still seems to be gathering speed. The 0.8% quarterly rise in GDP in the third quarter was the strongest expansion seen since Q2 2010. And whereas a year or so ago, the recovery was dependent on growth in a handful of sectors, output in nearly every sector is now increasing. What's more, the CIPS/Markit activity surveys for October indicate that GDP might be on track to grow by about 1.5% in Q4. Since the recovery still faces many challenges including falling real wages, fiscal tightening and weak bank lending, GDP may struggle to grow that quickly. But with confidence, employment and wealth all rising, the recovery seems unlikely to slow soon either.