UK exits recession with better-than-expected 0.6% GDP development By Reuters

By Suban Abdulla and David Milliken

LONDON (Reuters) -Britain’s economic system grew by essentially the most in almost in three years within the first quarter of 2024, ending the shallow recession it entered within the second half of final yr and delivering a lift to Prime Minister Rishi Sunak forward of an election.

The Workplace for Nationwide Statistics stated gross home product expanded by 0.6% within the three months to March, the strongest enlargement because the fourth quarter of 2021 when it grew by 1.5%.

A Reuters ballot of economists had pointed to a 0.4% enlargement of gross home product within the January-to-March interval, after GDP shrank by 0.3% within the remaining quarter of 2023.

Friday’s knowledge might be welcome information for Sunak who stated the economic system had “turned a nook”, though the opposition Labour Get together, which has a big lead in opinion polls, has accused Sunak and finance minister Jeremy Hunt of being out of contact to assume voters are feeling higher off.

“There isn’t any doubt it has been a tough few years, however immediately’s development figures are proof that the economic system is returning to full well being for the primary time because the pandemic,” Hunt stated.

The Financial institution of England, which held rates of interest at a 16-year excessive on Thursday, forecast quarterly development of 0.4% for the primary quarter of this yr and a smaller 0.2% rise for the second quarter.

Sterling strengthened in opposition to the U.S. greenback instantly after the figures had been launched.

On a month-to-month foundation, the economic system grew by 0.4 % in March, quicker than the 0.1% development forecast by economists in a Reuters ballot.

Britain stays one of many slowest nations to recuperate from the results of the coronavirus pandemic.

On the finish of the primary quarter of 2024, the nation’s economic system was simply 1.7% larger than its stage in late 2019, earlier than the pandemic, with solely Germany among the many G7 faring worse.