The UK economy grew as expected in the second quarter of 2023 but figures from the Office for National Statistics showed its recovery from the Covid-19 pandemic was faster than previously estimated.
The ONS said GDP increased an unrevised 0.2% in the second quarter of the year, although the estimate for the first quarter was revised up to 0.3% from 0.1%.
In output terms, growth in the latest quarter was driven by a 1.2% increase in the production sector while the household savings ratio grew by 9.1% up from 7.9% in the first quarter.
The ONS also reported that the UK economy’s recovery from the Covid-19 pandemic has been faster than previously thought.
UK GDP is now estimated to be 1.8% above pre-pandemic levels by the second quarter of this year, the ONS said.
Previously, the statistics agency estimated that GDP in the second quarter was 0.2% below its fourth-quarter 2019 level.
Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown, said: “The UK economy has shown signs of life. GDP is now 1.8% ahead of pre-pandemic levels as the economy grew 0.2% in the second quarter from the first three months of the year.”
“Crucially, GDP was up 0.6% from the same period the previous year, which was better than expected and has given the pound a shove in the right direction.”
Samuel Tombs at Pantheon Macroeconomics said for now it means the UK “no longer is the G7’s straggler.”
“Nonetheless, a stable picture might take some time to emerge, given that statistical authorities in other countries are revising their data too,” he added.
On today’s figures, Tombs said he continues to think that a recession will be avoided in the second half of this year.