The improvement in temperatures allowed the economy to recover the ground lost in May, according to official figures that are better than expected.
The Office for National Statistics (ONS) recorded a gross domestic product expansion of 0. 4% in the month, after 0 expansion in April.
A Reuters poll of economists showed a 0. 2% increase in May.
In April, more like a monsoon than April rains shook customer confidence and damaged construction.
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Liz McKeown, director of economic statistics at the ONS, said: “The economy grew strongly in May and all primary sectors recorded increases.
“Many stores and wholesalers had a month recovering from a weak April.
“Construction grew at its fastest speed in just a year after recent weakness as infrastructure and housing projects boosted the industry. At the same time, the production industry also saw slight growth, led by food and beverage companies.
“Over the past three months as a whole, the economy has grown at its fastest speed in more than two years, with strong expansion in services, offset by weaker long-term functionality in the structural sector. “
Chancellor of the Exchequer Rachel Reeves welcomed the figure, which predates the election.
He said: “Ensuring economic expansion is our national mission and we don’t have a minute to lose. That is why this week I have already taken the urgent steps necessary to lay the foundations of our economy, to rebuild Britain and to ensure that each and every component of our economy is rebuilt. Britain’s scenario is better. A decade of national renewal has begun and we are just beginning. »
On a quarterly basis, the United Kingdom’s interest rate-driven recession in the second half of 2023 ended earlier this year when the Bank of England ended its rate-hiking cycle, designed to curb inflation through the economy’s squeezing demand.
However, the long-awaited interest rate cuts proved difficult to achieve in 2024 due to persistent factors, coupled with the speed of service value increases and strong wage growth.
The measures taken so far by the new Labor government for the economy come with the creation of a National Wealth Fund.
A fall in borrowing costs, which money markets believe is imaginable thanks to a rate cut after the Bank’s next meeting on August 1, would facilitate this effort.
That outlook did not advance this week when a member of the bank’s rate-setting committee said he would not favor a cut from 5. 25% to 5%.
Jonathan Haskel’s opposition was echoed by fellow hawk Catherine Mann, followed by the Bank’s chief economist, Huw Pill, who said the timing of a rate cut remained an “open question. “
Financial markets lately are pricing in a 50/50 rate cut next month.
Earlier in the week, 60% were in favor of a reduction.