The second quarter saw a marked acceleration in the economy's growth rate to 0.6 per cent per quarter and the first estimate for the third quarter suggests that this faster rate of growth has persisted. This has to be seen in the context of a situation where, for the last two years economic commentators have been talking about a “downturn” but where there is little evidence of one in the aggregate data. Since the start of the new century in 2001, output has not actually fallen in any quarter and quarterly growth at an annual rate has dropped below 1 per cent per annum only once, in the first quarter of 2003. The industrial sector has been very weak; indeed its experience has been very similar to that of the last recession, but strong service sector growth has meant that the economy as a whole has not experienced a recession. It is of course too early to be sure that we have encountered a sustained period of average or above-average economic growth. The question can be answered definitively only ex post and after due time has been allowed for data revision, but it is certainly the implication of the recent data and our forecast taken together. For this reason, we are not concerned about the fall in industrial production shown in the industrial production index in August. While it obviously affects views of growth in the quarter we do not see it as the beginning of a new downturn.