UK economy grew faster than thought in first quarter of 2024 – business live | Business

June 27, 2024

Introduction: UK grows better than expected in Q1

Good morning and welcome to our continuing coverage of business, financial markets and the global economy.

The British economy has emerged from a brief recession last year and is growing at a faster pace than expected at the start of this year.

The latest GDP data released yesterday showed the economy grew by 0.7% in the January-March period.

This is up from a previous forecast of 0.6% and confirms that the UK was the fastest growing economy among the G7 countries in the first quarter of this year. It may support Chancellor of the Exchequer Rishi Sunak’s claim that the UK economy is turning around ahead of next week’s general election.

The Office for National Statistics published this encouraging news in its latest figures for the UK. GDP Quarterly National Accounts, January to March 2024.

It said Britain’s services sector expanded 0.8 percent in the quarter, beating its previous forecast of 0.7 percent growth.

However, production is now estimated to have increased by 0.6%, revised down from 0.8% growth.

The construction sector has contracted by 0.6% this year as it has been hit by bad weather.

GDP is estimated to grow 0.7% in the first quarter of 2024 (January-March), revised upward from an earlier estimate of 0.6%.

— UK Office for National Statistics (ONS) (@ONS) June 28, 2024

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The ONS reports:

On the expenditure side, increases in net trade and household expenditure were partially offset by declines in gross capital formation and government consumption.
The household savings rate is estimated at 11.1% in the latest quarter, up from 10.2% in the fourth quarter of 2023 (October-December).
Real household disposable income (RHDI) is estimated to increase by 0.7% in the first quarter of 2024, maintaining the same growth as the previous quarter.

Today’s GDP report also confirmed that the economy contracted in the second half of last year, shrinking by 0.1% in the third quarter and 0.3% in the fourth quarter, technically putting the economy into recession.

agenda

7am BST: UK national accounts Q1 2024
7am BST: German retail sales in May
7:45am: French inflation rate for June
8.55am BST: German unemployment report for June
10am BST: Italian inflation rate for June
1:30pm: US PCE Inflation Index for May
3pm BST: University of Michigan Consumer Sentiment Index for June

GDP per capita is a better measure of economic performance, as it measures how much the economy grew for each member of the population.

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And there’s good news here too, finally.

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Real GDP per head is estimated to have increased by 0.5% in the first quarter of 2024, up from a previous estimate of 0.4% growth.

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That follows seven consecutive quarters without positive growth.

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And on an annual basis, real GDP per capita – basically a measure of living standards – is estimated to be 0.6% lower compared with the same quarter a year ago.

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NEW@ons just revised up its estimate of UK economic growth in the first quarter of this year from 0.6% to 0.7%. And GDP per head up 0.5% (previous estimate was 0.4%).
These were already good figures. Now they're a little better. https://t.co/q3TKQAKrsS

— Ed Conway (@EdConwaySky) June 28, 2024

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This table, from today’s national accounts, shows how the UK was the fastest-growing G7 member in Q1….

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….but lags behind many rivals when you look at growth since the pandemic.

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GDP Q1 2024″,”caption”:”UK GDP Q1 2024″,”credit”:”Photo: ONS”}},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

As you can see, England (+0.7%) recorded the fastest quarter-over-quarter growth in the first quarter, Canada (+0.4%), Italy And that we (both +0.3%), France and Germany (both +0.2%) and Japan (0.5% decrease)

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But Britain’s growth rate of 1.8% since the end of 2019 is slower than the US, Canada, Italy, France and Japan, but better than Germany, which has barely grown since then.

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Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.

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The UK economy grew faster than previously thought at the start of this year, as it emerged from last year’s short recession.

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Newly updated GDP data, just released, shows that the economy grew by 0.7% in January-March.

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That’s up from a previous estimate of 0.6%, and confirms that the UK was the fastest growing G7 economy in the first quarter of this year. That could bolster Rishi Sunak’s argument that the economy is turning a corner, ahead of next week’s general election.

“,”elementId”:”842c2954-e31a-4d0d-b792-afdfbebbc4c2″},{“_type”:”model.dotcomrendering.pageElements.RichLinkBlockElement”,”prefix”:”Related: “,”text”:”Labour and Lib Dem tactical voting plans will have big impact on Tory seats”,”elementId”:”c5bbec94-fe8a-4fa8-b7ac-88ee815e6f85″,”role”:”thumbnail”,”url”:”https://www.theguardian.com/politics/article/2024/jun/27/labour-lib-dem-tactical-voting-plans-impact-tory-seats”},{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”

The Office for National Statistics released this encouraging news in the UK’s latest GDP quarterly national accounts, for January to March 2024.

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They show that the UK’s services sector expanded by 0.8% in the quarter, up from a previous estimate of 0.7% growth.

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Production, though, is now estimated to have grown by 0.6%, revised down from a 0.8% increase.

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The construction sector shrank by 0.6%, as builders were hit by bad weather this year.

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GDP is estimated to have grown by 0.7% in Quarter 1 (Jan to Mar) 2024, revised up from a first estimate of 0.6%.

Read more ➡️ https://t.co/kMa7MTxKxV pic.twitter.com/ISkPD2lZEf

— Office for National Statistics (ONS) (@ONS) June 28, 2024

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The ONS reports:

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In expenditure terms, there were increases in the volume of net trade and household spending, partially offset by falls in gross capital formation and government consumption.

The household saving ratio is estimated to be 11.1% in the latest quarter, up from 10.2% in Quarter 4 (Oct to Dec) 2023.

Real households’ disposable income (RHDI) is estimated to have grown by 0.7% in Quarter 1 2024, maintaining the same growth as the previous quarter.

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Today’s GDP report also confirms that the economy shrank in the second half of last year – contracting by 0.1% in quarter 3, and 0.3% in quarter 4 – a technical recession.

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The agenda

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7am BST: UK national accounts for Q1 2024

7am BST: German retail sales for May

7.45am BST: French inflation rate for June

8.55am BST: German unemployment report for June

10am BST: Italian inflation rate for June

1.30pm BST: US PCE inflation index for May

3pm BST: University of Michigan’s consumer sentiment index for June

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Important Events

UK GDP per capita revised upwards

GDP per capita is a better indicator of economic performance as it measures economic growth per member of the population.

And finally, there’s some good news here.

Real GDP per capita is estimated to grow by 0.5% in the first quarter of 2024, up from a previous estimate of 0.4% growth.

This followed seven consecutive quarters without positive growth.

And on an annual basis, real GDP per capita, essentially a measure of living standards, is estimated to have fallen 0.6% from the same period last year.

new@Ounce The UK government has revised up its forecast for economic growth in the first quarter of this year from 0.6% to 0.7%, with GDP per capita rising by 0.5% (previously forecast at 0.4%).
These were already good numbers. Now they’re even better. https://t.co/q3TKQAKrsS

— Ed Conway (@EdConwaySky) June 28, 2024

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new@Ounce The UK government has revised up its forecast for economic growth in the first quarter of this year from 0.6% to 0.7%, with GDP per capita rising by 0.5% (previously forecast at 0.4%).
These were already good numbers. Now they’re even better. https://t.co/q3TKQAKrsS

— Ed Conway (@EdConwaySky) June 28, 2024

Table: UK tops G7 rankings last quarter (but not since pandemic)

This table from today’s national accounts shows that the UK was the fastest growing G7 country in the first quarter.

… But if you look at its growth since the pandemic, it’s lagging behind many of its rivals.

UK GDP Q1 2024 Photo: ONS

But Britain’s growth rate of 1.8% since the end of 2019 is slower than the US, Canada, Italy, France and Japan, but better than Germany, which has barely grown since then.

Introduction: UK grows better than expected in Q1

Good morning and welcome to our continuing coverage of business, financial markets and the global economy.

The British economy has emerged from a brief recession last year and is growing at a faster pace than expected earlier this year.