UK economy exits recession ahead of election
LONDON, United Kingdom — Britain exited recession with stronger-than-expected growth in the first quarter of 2024, official data showed Friday, in a boost to embattled Prime Minister Rishi Sunak ahead of this year’s election.
Gross domestic product expanded by 0.6 percent in the first three months of this year, the Office for National Statistics (ONS) said in a statement, beating market expectations of 0.4 percent.
The economy had suffered two successive quarters of contraction in the second half of last year, meeting the technical definition of a recession on the back of elevated inflation and a cost-of-living crisis.
Sunak, whose governing Conservatives are trailing the main opposition Labor Party ahead of a general election, has made economic growth one of his top priorities.
READ: UK inflation falls to lowest level since late 2021 as food prices ease
“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.
Growth outlook
“We’re growing this year and have the best outlook among European G7 countries over the next six years,” he added.
Friday’s bright news came one day after the 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.
READ: Bank of England edges closer to rate cut, possibly in June
“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.
“Car manufacturers also had a good quarter. These were only a little offset by another weak quarter for construction.”
GDP had shrunk by 0.3 percent in the fourth quarter of 2023 after contracting by 0.1 percent in the prior three months.
