The UK economy overcame last year’s recession with GDP growth of 0.6% in the first quarter of 2024, the Office for National Statistics (ONS) reported on Friday.
British GDP contracted by 0.1% in the third quarter of last year and by 0.3% in the fourth quarter. Economists consider two consecutive quarters of contraction to represent a technical recession.
The economic recovery in the first quarter of the year was more pronounced than expected by experts, who expected an advance of 0.4%.
Britain’s central bank, the Bank of England, was also more pessimistic in its forecast, also at 0.4%.
The Bank of England, which raised key interest rates 14 times between December 2021 and last September, maintained its guidance interest rate at 5.25% on Thursday.
But the institution said it was “optimistic” about the decline in inflation, which would allow it to lower interest rates in the coming months and thus reduce the economic burden on families and companies.
Although “things are still difficult for many people”, the British economy “has been transformed”, Prime Minister Rishi Sunak welcomed on Friday.
“We are confident that growth will continue for the rest of the year, driven by a favorable economic context,” especially low inflation and rising wages, estimated Yael Selvin, an economist at KPMG.
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