The UK economy rebounded more than forecast in November driven by growth in the services sector, according to official figures which ease fears of a technical recession.
Gross domestic product (GDP) rose 0.3% month on month in November, following a 0.3% decline the previous month, according to data from the Office for National Statistics (ONS), stronger than the 0.2% growth forecast by economists.
The figures were lifted by 0.4% growth in services output in November which followed a fall of 0.1% in October, revised up from a 0.2% fall.
Production output grew by 0.3% in November, following a fall of 1.3% in October (revised down from a 0.8% fall) and the construction sector fell by 0.2% in November after a fall of 0.4% in October (revised up from a 0.5% fall).
ONS chief economist Grant Fitzner said: “GDP bounced back in the month of November . . . led by services with retail, car leasing and computer games companies all having a buoyant month.
“The longer-term picture remains one of an economy that has shown little growth over the last year,” he added.
Samuel Tombs at Pantheon Macroeconomics said it was a “coin toss” as to whether the UK economy will avoid a second consecutive quarterly fall in the fourth quarter.
“Nevertheless, with employment still rising and business and consumer confidence recovering, it would be overblown to label this a recession if GDP did indeed drop slightly,” he said.
He pointed out November’s increase in GDP reversed all of October’s decline, rebounding in consumer-facing sectors after spending in October was adversely affected by Storm Babet and the later-than-usual timing of school holidays in some areas.