UK economic growth, February 2024
Plane contrails streak across the sky over Regent Street on February 15, 2024 in London, England.
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LONDON — U.K. gross domestic product rose 0.1% in February, the Office for National Statistics said on Friday, providing another sign of a return to sluggish economic growth this year.
The month-on-month figure was in line with a projection in a Reuters poll. On an annual basis, GDP was 0.2% lower.
The economy contracted in the third and fourth corners of 2023, putting the U.K. in a technical recession.
January recorded light growth, which was revised upward to 0.3% on Friday.
Construction output, which boosted growth at the start of the year, fell 1.9% in February. Instead, production output was the biggest contributor to the GDP, rising by 1.1% in February, while growth in the U.K.’s dominant services sector slowed to 0.1% from 0.3%.
The reading “all-but confirms the recession ended” last year, Paul Dales, chief U.K. economist at Capital Economics, said in a note.
“But while we expect a better economic recovery than most, we doubt it will be strong enough to prevent inflation (and interest rates) from falling much further as appears to be happening in the U.S.,” Dales added.
British inflation fell more than expected in March, to a nearly two-and-a-half year low of 3.4%.
In the U.S., however, price rises came in above forecasts at 3.5%, pushing back expectations for the start of interest rate cuts to September.
This is a breaking news story and will be updated shortly.
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