Section II. The forecast in detail

Although we are now into the new year, figures for the final quarter of 2000 are generally estimated in the forecast. Third quarter real GDP growth in 2000 was 0.7 per cent, down from 1 per cent the previous quarter with fourth quarter growth of 0.3 per cent reported after the forecast was completed. Overall this yields an estimate for growth for 2000 as a whole of about 3 per cent. Much of the fourth quarter has been affected by the continued disruption to the railway network coupled with depressed output in the oil and gas industry, something we comment on further below. However, as seasonally adjusted retail sales growth for the fourth quarter was 1.3 per cent, following on from a revised 1.2 per cent growth the previous quarter, the picture is not uniformly weak. It remains to be seen exactly how much the small fourth quarter growth rate is due to special factors. Growth of almost 3 per cent in 2001 is forecast, followed by 3¼ per cent in 2002, with the growth rate falling back towards its trend value of 2½ per cent after this.