The fastest growth in business investment for two years helped support Britain’s overall economic growth in the first quarter, boosting hopes the recovery is become more sustainable.
GDP grew by 0.8% in the first three months of the year, the Office for National Statistics said in its final revision, unchanged from its previous growth estimate. Annual GDP growth was revised down slightly to 3.0% from 3.1% but was still the strongest since 2007.
Releasing more details on what was behind the quarterly growth, the ONS said household spending remained the driving force while the construction sector picked up steam. But growth for the dominant services sector was revised lower from previous estimates.
The first quarter marked an acceleration from 0.7% growth in the final months of 2013 and the UK economy is now only 0.6% below its pre-crisis level. Economists say it has most likely regained its previous strength during the current quarter. Still, the UK has taken longer than other advanced economies to regain its pre-recession strength.
“It will have taken the economy more than six years to surpass the peak level that was seen in the first quarter of 2008 but it has undoubtedly finally achieved that feat in the second quarter,” said Howard Archer, economist at IHS Global Insight.
He said news in Friday’s figures that business investment was up 5% quarter on quarter and 10.6% year on year, suggested the recovery was becoming more entrenched.
via The Guardian