Economy returns to slight growth in May after flatlining in April, official figures show

11 July 2024, 07:06 | Updated: 11 July 2024, 09:05

The UK economy grew slightly in May
The UK economy grew slightly in May. Picture: Alamy

By Kit Heren

The UK economy grew by 0.4% in May, according to the Office for National Statistics.

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That came after a month of no growth in April, when spending was affected by wet weather.

The improvement in May was mainly driven by services, which rose by 0.3%, as well as construction output, which grew by 1.9% over the month.

The May figures beat the expectations of many economists, who had predicted that GDP would increase by 0.2% in the month.

The economy is estimated to have grown by 0.9% in the three months to May 2024 in comparison with the three-month period leading up to February 2024.

Read more: UK economy fails to grow in wet April, official figures show

Read more: Economy grew more than first estimated in early 2024, in 'boost to next Prime Minister'

Caller does not trust Labour's rhetoric on the economy

ONS director of economic statistics Liz McKeown said: "The economy grew strongly in May, with all the main sectors seeing increases.

"Many retailers and wholesalers had a good month, with both bouncing back from a weak April.

"Construction grew at its fastest rate in almost a year after recent weakness, with housebuilding and infrastructure projects boosting the industry."

Responding to the figures, Labour's new Chancellor Rachel Reeves said: "Delivering economic growth is our national mission, and we don't have a minute to waste.

"That is why this week I have already taken the urgent action necessary to fix the foundations of our economy to rebuild Britain and make every part of Britain better off. A decade of national renewal has begun, and we are just getting started."

The economy grew by an estimated 0.6% in the first quarter of 2024, pulling the UK out of a small recession at the end of last year.

Suren Thiru, ICAEW Economics Director, said: “These figures confirm a robust rebound in economic activity as stronger services and construction output helped return the economy to growth.

“May’s GDP uptick may well have been followed by a June washout, with wet weather likely to have stifled output from key sectors of the economy, despite a helping hand to hospitality and some retailers from Euro 2024. 

“Longer-term, the new government faces an uphill struggle to achieve its ambition to significantly uplift the UK’s growth trajectory, unless it can substantially increase productivity and tackle economic inactivity. 

“These GDP figures may make an August rate cut less likely by providing those rate setters, who are concerned about underlying price pressures, with sufficient confidence about the UK’s economic recovery to continue putting off loosening policy.”

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