The latest economic data could bolster the central bank’s plans to raise interest rates further.
(Photo: imago/Loop Images)
London The British economy surprisingly grew in May. The gross domestic product (GDP) increased by half a percent compared to the previous month, as the statistical office (ONS) announced on Wednesday. Economists surveyed by the Reuters news agency had forecast stagnation.
But the healthcare industry in particular has proven to be a growth engine as a result of a trend towards more doctor visits. Business was also booming in travel agencies and freight forwarders. Experts disputed whether the unexpected plus in May could still avoid the predicted drop in GDP in the quarter from April to June.
According to analysts at the investment banking company RBC Capital Markets, there is not much missing for growth in the entire second quarter. “It’s too early to pop the corks,” said UBS economist Dean Turner.
More specifically, the data continued to point to a squeezed economy as many Brits cut back on spending amid the high cost of living. New Finance Minister Nadhim Zahawi welcomed signs of growth but warned against complacency. “We are working with the Bank of England to curb inflation,” said Zahawi.
Top jobs of the day
Find the best jobs now and
be notified by email.
The latest economic data could bolster the central bank’s plans to raise interest rates further. Despite fears that the UK could slip into recession later this year, the central bank is expected to tighten interest rates again on August 4th. The central bank expects inflation to reach 11 percent in October.
More: Race to succeed Johnson started – Tory trench warfare threatens