UK GDP is estimated to have risen by 0.1% in February and the determine for January has been revised up from 0.2% to 0.3% progress, elevating expectations that the UK will keep away from a chronic recession.
There was sturdy progress in manufacturing, notably fuel and automobile manufacture.
Development stays anaemic, nonetheless, in line with most specialists.
Companies output rose by 0.1% month-on-month with building output down 1.9% month-on-month. Manufacturing rose 1.1% month-on-month.
ONS, which produces the info, stated that the development trade was hit by moist climate.
The UK entered a shallow recession on the finish of 2023 however the financial system now seems to be rising, albeit at a gradual price.
Danni Hewson, head of economic evaluation at AJ Bell, stated the information was typically constructive.
She stated: “Any progress is nice information and definitely the UK appears to be trudging slowly out of final yr’s short-lived recession. However at 0.1% in February and even with the upwardly revised 0.3% in January, UK progress appears fairly pitiful once you evaluate it to the financial image on the opposite facet of the pond.
“The impression of rain on GDP explains why we Brits are so pre-occupied with the climate. All these downpours dampened spirits and stored customers tucked up of their houses. Building work slowed as soon as once more and the rain undoubtedly performed an element right here, however it wasn’t the entire story.”
Nicholas Hyett, funding analyst at HNW-focused funding dealer Wealth Membership stated: “Constructive UK GDP progress in February, coming along with an improve to the January estimate, will do nothing to reassure markets that rate of interest cuts are locked in for the primary half of this yr.
“Having stated that, areas of the financial system which can be depending on discretionary spending do look form of soggy. Lodging and foods and drinks companies each contracted in February and the development sector is within the doldrums (with eight out of 9 sectors seeing a lower month-on-month). There are solutions moist climate could have performed an element right here, however an rate of interest lower might be fairly useful to these areas of the financial system nonetheless.”
Ed Monk, affiliate director at Constancy, stated: “It has to rely as excellent news that the financial system is returning to progress – the GDP estimate immediately means the UK grew 0.4% throughout January and February. Final yr’s recession seems to have been each shallow and short-lived however the reality stays that UK progress stays weak. We could also be shaking off technical recession however that gained’t change the sensation that there’s little or no momentum within the financial system.
“If immediately’s studying is constructive for progress general it might find yourself being unhealthy information for each debtors and monetary markets, within the short-term not less than. Each are ready for the Financial institution of England to chop charges however wage rises and now higher efficiency in elements of the financial system are including to inflationary pressures. Expectations of price cuts this yr have softened and markets now count on solely two cuts earlier than 2025. It appears you may have a recovering financial system, or you may have the aid of decrease charges – however you may’t have each on the similar time.”
