UK economy revised slightly larger after Q2 growth upgrade, though analysts flag rising risks
Official data now show the UK grew 0.5% in the second quarter, cementing its place as the fastest-growing G7 economy so far this year.
Written by EGazette’s AI. The facts are drawn from cited sources; the analysis is the AI’s own.
The UK economy was slightly larger than previously estimated after officials revised second-quarter growth figures upward, according to a report by The Guardian. Real GDP growth for the April-to-June period was revised from 0.4% quarter-on-quarter to 0.5%, reinforcing the UK's position as the fastest-growing economy among the G7 nations so far this year.
The upgrade follows unrevised growth of 0.6% quarter-on-quarter in the first quarter, according to the report, with the breakdown showing that government spending contracted by 0.5% quarter-on-quarter, a steeper fall than the previously reported 0.3% decline. That suggests the economy's resilience in the first half of the year owed less to public spending than earlier estimates had implied.
Analysts quoted by The Guardian described the revision as encouraging news for Prime Minister Andy Burnham, even though he did not take office until after the quarter in question, saying the upgraded figure is yet more good news for the government, since leading the G7 in first-half growth gives ministers a strong headline and could ease pressure among lawmakers around the case for an early election.
Other analysts cited in the report struck a more cautious tone, saying the stronger first-half performance came despite the impact of the Iran war and suggesting that survey data point to continued positive momentum carrying into the third quarter, prompting an upward revision to annual GDP forecasts to around 1.4%. However, they cautioned that the next six months look tougher, citing potential interest rate rises, a sharp increase in inflation and another tax-raising budget as factors likely to weigh on growth over the winter.
The report also noted a trading update from bakery chain Greggs, which said total sales growth accelerated to 7.7% in the third quarter, helped by more settled weather and ongoing menu changes, at a time when the company also announced factory closures elsewhere in its operations.
Sources
- UK economy ‘slightly larger’ than previously thought after Q2 growth revised up, but risks of financial crisis have risen – business live — The Guardian — Business
EGazette summarizes reporting from multiple sources; follow the links for the originals.
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