UK nears recovery as GDP grows

Apr 12, 2024

Britain's economy is on the brink of overcoming its recent recession, with February data indicating a 0.1% rise in GDP, aligning with forecasts. This increment sustains the recovery initiated in January, which saw an adjustment in growth figures from 0.2% to 0.3%.

The UK previously met the recession criteria with contractions in the last two quarters of 2023. For the first time since last summer, the three-month period ending in February also recorded a 0.1% growth, marking a mild recovery from last year's spending cuts during the cost of living crisis.

February's growth was notably spurred by a 17.8% increase in car production compared to the same month last year.

In contrast, construction suffered a 1.9% decline due to significant rainfall, which halted activities on many sites. The services sector, representing approximately 80% of the economy, only managed a marginal growth of 0.1%, hindered by weak performance in retail and wholesale.

Record rainfall in February, the fourth highest in England's history, affected physical store sales but boosted online transactions. Additionally, conflicts in the Middle East disrupted global supply chains, impacting various sectors including retail and healthcare, with around 10% of businesses in these areas experiencing difficulties.

Liz McKeown, an ONS director of economics statistics, said:

"The economy grew slightly in February with widespread growth across manufacturing, particularly in the car sector. Services also grew a little, with public transport and haulage and telecommunications having strong months."

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