July Nowcast update…

-

This blog reports the latest estimate of economic growth in Scotland from our nowcasting model. Unlike previous blog posts, this one only includes estimates for one quarter rather than two.

The reason for this is that the Scottish Government have now shortened the time between the end of the quarter and the release of data on that quarter.

Data for 2018 Q1 (January – March) were released on 27th June 2018, only 88 days after the end of the quarter.

While this is still a longer lag in the release of the data than that for the UK as a whole, it is much shorter than the previous publication lag for Scottish data of around 115 days.

Improvements in the timeliness of regional economic statistics are to be welcomed, and statisticians in the Scottish Government should be congratulated for their work in this area.

This shorter lag between the end of the quarter and the release of data on that quarter has the effect of meaning that our final (and sixth) nowcast estimate which we previously produced is no longer necessary.

We therefore only report our estimate for 2018 Q2 in this blog.

  • This estimate is for growth of 0.32%, which at an annual rate becomes 1.27%.

This is slightly higher than the official estimate for growth in Q1 (which was 0.2%).

Our estimate also suggests that growth in Scotland might be slightly faster than the growth in the UK economy over the last three months. This comparison relates to a new publication strategy by ONS, which warrants further discussion.

This UK growth rate refers not to Q2 2018 as is usually reported for the UK (and indeed for Scotland), but reflects GDP growth on a “rolling” three month basis to May 2018.

To explain, the ONS have started, from this month (July), to release monthly updates on UK GDP on a rolling three month basis.

This means that each month, the ONS will release an estimate of the growth in the economy over the three months before the previous month, (i.e. growth between March to May 2018 relative to December to February 2018 was released in June 2018).

The data released this month covered the period March – May 2018, data released next month will cover the period April – June 2018, and so on and so forth.

Again, investment by statisticians in more timely updates on the economy is to be welcomed – although of course it will be important, as with an data improvement, to benchmark improvements in timeliness against changes in the quality of any estimates.

Next month we will, as usual, produce two estimates of Scottish GDP growth, one for Q2 2018 (with official data released on 29th September) and one for Q3 2018.

July 11, 2018