The UK economy managed to avoid a recession as it grew by 0.6 per cent in the first quarter of the year, according to the Office for National Statistics. This growth exceeded expectations after economists had predicted a 0.4 per cent improvement. Despite two consecutive quarters of decline, which had led to a technical recession in the latter part of 2023, the return to positive growth in the UK economy in the first quarter was largely driven by strength in service industries such as retail, public transport, haulage, and health.
Liz McKeown, the ONS director of economic statistics, pointed out that this growth comes after two consecutive quarters of decline. The car manufacturing sector also performed well during this period. However, these gains were somewhat dampened by ongoing weakness in the construction sector. In response to the GDP figures, Chancellor Jeremy Hunt expressed optimism about the state of the economy and highlighted positive trends such as wage growth outpacing inflation, falling energy prices, and tax cuts that will benefit the average worker.
The Chancellor’s remarks and analysis from ONS provide hope for continued economic improvement in the future. With various sectors contributing to growth and positive trends emerging from different sectors, there is a sense that things are finally looking up for UK’s economy.
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