The United Kingdom has exited recession with stronger-than-expected growth in the first quarter of 2024. This comes ahead of the general elections that is set to happen this year.
Better than Expected GDP growth
United Kingdom's economy grew 0.6% in the first three months of this year, the Office for National Statistics (ONS) said in a statement. This outpaces market's prediction of 0.4%.
Britain's economy suffered two consecutive quarter of contraction in the last part of the year. By this, UK entered recession with elevated inflation and a cost-of-living crisis. GDP had shrunk by 0.3% in the fourth quarter of 2023 after contracting by 0.1% in the prior three months.
This comes as day after Bank of England kept its main interest rate at a 16-year high, but hinted at a cut over the summer as UK inflation cools further -- and forecast emergence from recession.
"After two quarters of contraction, the UK economy returned to positive growth in the first three months of this year," said ONS director of economic statistics Liz McKeown. "There was broad-based strength across the service industries with retail, public transport and haulage, and health all performing well", she added
Rishi Sunak, whose governing Conservatives are trailing the main opposition Labour Party ahead of a general election, has made economic growth one of his top priorities.
"There is no doubt it has been a difficult few years, but today's growth figures are proof that the economy is returning to full health for the first time since the pandemic," said finance minister Jeremy Hunt. "We're growing this year and have the best outlook among European G7 countries over the next six years," he added.
[with AP inputs]
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