Britain IS out of recession: Economy expanded by 0.6% in Q1

Britain is out of recession after official figures showed the economy growing strongly in the first quarter of the year.

GDP expanded by 0.6 per cent in the first three months of 2024, faster than expected and clawing back ground after going into reverse at the end of 2023.

Recession is defined as two consecutive quarters of contraction.

The confirmation is a boost for Rishi Sunak and Chancellor Jeremy Hunt as they desperately try to prove to voters that their plan is working.

The PM insisted ‘the economy has turned a corner’. ‘We know things are still tough for many people, but the plan is working, and we must stick to it,’ he said. 

Mr Hunt said it was ‘proof that the economy is returning to full health for the first time since the pandemic’. 

GDP expanded by 0.6 per cent in the first three months of 2024, faster than expected and clawing back ground after going into reverse at the end of 2023

The PM insisted ‘the economy has turned a corner’

Chancellor Jeremy Hunt said it was ‘proof that the economy is returning to full health for the first time since the pandemic’

It was better than the 0.4 per cent most economists had pencilled in – which might give the Bank of England pause for thought as it considers interest rate cuts as early as next month. 

A ‘hotter’ economy might add to inflationary pressures.  

Mr Hunt said: ‘There is no doubt it has been a difficult few years, but today’s growth figures are proof that the economy is returning to full health for the first time since the pandemic.

‘We’re growing this year and have the best outlook among European G7 countries over the next six years, with wages growing faster than inflation, energy prices falling and tax cuts worth £900 to the average worker hitting bank accounts.’

Hopes have been mounting that the picture was improving for UK plc, with metrics showing an increase in activity.

ONS Director of Economic Statistics Liz McKeown said: ‘After two quarters of contraction, the UK economy returned to positive growth in the first three months of this year.

‘There was broad-based strength across the service industries with retail, public transport and haulage, and health all performing well. Car manufacturers also had a good quarter. These were only a little offset by another weak quarter for construction.

‘In the month of March the economy grew robustly led, again, by services with wholesalers, the health sector and hospitality all doing well.’

But shadow chancellor Rachel Reeves said: ‘This is no time for Conservative ministers to be doing a victory lap and telling the British people that they have never had it so good. The economy is still £300 smaller per person than when Rishi Sunak became Prime Minister.