UK cements its place as fastest-growing G7 country so far this year
This morning’s upgrade to UK growth in April-June is a boost to Andy Burnham, analysts say, even though he didn’t take office until almost a month later.
Chris Beauchamp, chief market analyst at IG, says:
“Still on a post-speech high, the upgraded figure is yet more good news for the UK’s still-new(ish) prime minister.
The highest growth in the G7 for the first half is certainly a headline and one that will help keep nervous MPs in line for a while, plus it helps take off pressure for a new election - why risk it now when things appear to be improving nicely.”
The upward revision to real GDP growth in Q2, from 0.4% q/q to 0.5% q/q, suggests that the economy has been a bit more resilient to higher energy prices in the first half of the year than previously thought. This resilience may continue into Q3, but we still expect it to fade in Q4 as higher inflation takes a bigger bite out of households’ real incomes.
The 0.5% q/q gain in Q2 real GDP followed unrevised growth of 0.6% q/q in Q1, with the breakdown still showing that the economy is no longer being heavily supported by government spending, which contracted by 0.5%…
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