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. This growth comes after two consecutive quarters of decline, which had led to a technical recession in the latter part of 2023.
In response to the GDP figures, Chancellor Jeremy Hunt expressed optimism about the state of the economy. He noted that despite the challenges of the past few years, the growth figures indicate that the economy is on track to recover fully for the first time since the pandemic. Hunt highlighted positive trends such as wage growth outpacing inflation, falling energy prices, and tax cuts that will benefit the average worker.
Liz McKeown, the ONS director of economic statistics, pointed out that 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. The car manufacturing sector also performed well during this period. However, these gains were somewhat dampened by ongoing weakness in the construction sector.
Overall, the UK economy showed signs of recovery in the first quarter of the year, with various sectors contributing to growth. The Chancellor’s remarks and the analysis from ONS highlight positive trends and provide hope for continued economic improvement in the future.