Consumers left to drive recovery as oil sends business investment falling

The Office for National Statistics has revealed that business investment fell by £600m in the final quarter of 2014, down 1.4% on the previous three months, although the figure could have been skewed by the drop off of investment in the oil industry on the back of a slump in crude prices. The data contrasted with a 0.5% expansion of GDP in the final quarter, and by 2.6% for 2014 as a whole, raising questions about UK's economic rebalancing. Consumer spending during the same period increased by 0.5%, its fourteenth consecutive quarter of growth. GfK's consumer confidence index suggests the trend is set to continue as it shows people are more optimistic today about their financial situation over the next 12 months than they were in January. The ONS figures also showed trade contributed 0.6 of a percentage point to growth after the best quarterly pick-up in exports for a year and a half. Despite falls in the two previous quarters, business investment still grew by 6.8% over 2014, its fastest annual growth rate in seven years.

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