The UK has averted a recession for the time being as the economy grew 0.2 percent between April and June, the latest figures show.
Data from the Office for National Statistics showed that gross domestic product (GDP) rose 0.5 percent in June, helped by the manufacturing sector.
Economists had expected GDP to grow 0.2 percent in June and flat for the full quarter. In comparison, it grew 0.1 percent in the first quarter of the year.
Darren Morgan, director of economic statistics at the ONS, said: “The economy recovered from the impact of the additional bank holiday in May and posted strong growth in June. Manufacturing had a particularly strong month, with both the auto industry and the often erratic pharmaceutical industry posting particularly buoyant growth.
“Services also had a strong month with publishing, auto sales and legal services, but these were partially offset by declines in healthcare, which was impacted by further strike action.
“Construction activity also increased sharply, as did pubs and restaurants, both benefited by the hot weather.”
Chancellor Jeremy Hunt said: “The measures we are taking to fight inflation are starting to take effect, which means we are laying the strong foundations needed for the economy to grow.”
“The Bank of England now forecasts that we will avoid a recession and if we stick to our plan to help people get jobs and boost business investment, we will grow faster than Germany, France and Italy over the longer term, according to the IMF.”
This means that quarterly GDP is still 0.2% below the level of the last three months of 2019 before the Covid-19 pandemic hit and forced the country into lockdown.
Companies told the ONS their production increased in June to make up for the extra holiday in May.
Statisticians noted that the human health and social work sector weighed on GDP in June, contracting 0.8%. Young doctors went on strike for four days during the month, while nurses did not strike.
The new data puts the UK on a better path to avoid falling into a recession, defined as two consecutive quarters of contracting GDP.
However, forecasts by the Bank of England assume that growth will remain sluggish in the coming years.
Labour’s shadow chancellor Rachel Reeves said: “Economic growth is still stagnant.
“Thirteen years of economic mismanagement by the Conservatives have left Britain worse off and trapped in a cycle of low growth and high taxes.
“Labour’s plan for the economy will boost growth, raise wages and lower bills to make working people better off.”