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Economy grew faster than previously reported

Growth story: the island's GDP grew 2.4 per cent after inflation in the third quarter of last year

Bermuda’s economy expanded at a healthy pace in the third quarter of last year — and revisions to past data show the economy grew more than previously reported in the three quarters before that.

Gross domestic product rose 3.9 per cent in the July through September period — or 2.4 per cent after inflation is taken into account — according to a report released yesterday by the Department of Statistics.

This followed real GDP growth of 3.1 per cent in the second quarter of 2017, during which the island hosted the America’s Cup, revised upward from 1.5 per cent.

In last year’s first quarter, real GDP growth had previously been reported as negative 0.1 per cent — but that was revised to positive 0.7 per cent in yesterday’s report.

And real GDP growth in the fourth quarter of 2016 was also revised upwards from 0.7 per cent to 0.9 per cent.

In its report, the Department of Statistics stresses that data are temporary and subject to revision as additional data becomes available for the latest quarters, which is used to replace existing estimates.

During the third quarter of 2017, quarterly GDP at constant prices was estimated at $1,117.9 million. The main driver was a $31.6 million increase in the external balance of goods and services.

Household final consumption increased by 0.3 per cent to $624.2 million. Increased expenditure on accommodation and catering services were offset by lower consumption of electricity and air transport services.

Government consumption decreased 0.2 per cent during the third quarter.

Gross capital formation, or investment in fixed assets, decreased $7.2 million, or 4.2 per cent, reflecting lower investment in machinery and equipment such as boats and related equipment. Capital formation related to construction also registered a small decline during the period.

The net surplus on trade in goods and services increased $31.6 million or 30.7 per cent, due to the combined effect of higher receipts for exports of services and lower payments for imports of services, the report adds.

Receipts from the exports of goods and services rose $30 million due mostly to increased tourist expenditure.

Imports of goods and services, which have a downward effect on GDP growth, fell 0.4 per cent reflecting lower payments for air transport services and professional and management services.