Economy is rising on the quickest tempo in over TWO YEARS
The economy is growing at the fastest rate in more than two years after the latest monthly figures showed a better-than-expected performance.
GDP increased by 0.4 per cent in May, above the 0.2 per cent analysts had pencilled in.
Despite flatlining in April, it means that UK plc expanded by 0.9 per cent over the past three months, the best since January 2022.
The brighter news comes despite Chancellor Rachel Reeves giving dire warnings about the state of the public finances after Labour took over from the Tories.
She has fuelled fears of looming tax hikes by suggesting the government’s books are even worse than thought, and stressing the need to push up growth.
The upturn in the economy raises more questions about why Rishi Sunak chose to pull the trigger on the election for July 4, instead of waiting for the situation to improve.
However, it could delay hopes of pressure easing on mortgage-payers – as the Bank of England might be concerned about persistent inflation.
GDP increased by 0.4 per cent in May, above the 0.2 per cent economists had pencilled in
The brighter news comes despite Chancellor Rachel Reeves giving dire warnings about the state of the public finances after Labour took over from the Tories
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 house building and infrastructure projects boosting the industry. Meanwhile, manufacturing also grew a little, led by food and drink firms.
‘Across the last three months as a whole, the economy grew at its quickest pace for over two years with strong growth across services, partially offset by the weaker longer-term performance from construction.’
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.’
But shadow chief secretary to the Treasury Laura Trott said: ‘Today’s figures show that the steps we put in place whilst in government have strengthened the economy.
‘These figures also prove Labour are inheriting an economy turning a corner, after the many difficult decisions we took in government.
‘We will keep Labour to the promises made in the campaign not to raise taxes on working people. As Rachel Reeves, the new Chancellor, herself recognised, the books were open.’
All sectors of the economy saw growth in May, according to the ONS
