According to the latest Chambers of Commerce’s economic survey of nearly 8,000 businesses, the UKâ€™s economy grew 0.3 percent in the first quarter of 2012. The growth rate was slightly above the forecast level. In the last three months of 2011, the countryâ€™s economy contracted by 0.3 percent.
The Purchasing Managers’ Index (PMI) for the construction sector rose in March to a 21-month high, as orders rose and firms became more optimistic about the outlook.
Most of the key measures in this quarterly survey were at their highest level in nine months in the manufacturing and service sector, though they still were below the levels seen before the 2008 financial crisis.
Export growth is outpacing that of domestic demand, and that could facilitate rebalancing Britain’s economy away from its past reliance on public spending and internal consumer demand.
Hiring intentions for both manufacturers and services companies are also the strongest in nine months, which may help to curtail rising unemployment, currently at 8.4 percent. Investment in plant and machinery for manufacturers is at the highest since the fourth quarter of 2010.
As per the forecast by the government’s Office of Budget Responsibility, the UKâ€™s economy is expected to grow 0.8 percent in 2012. The economic growth of the first quarter reflects a modest improvement in the UKâ€™s economic situation and the fact that the country will likely avoid a recession. However, according to some economists, the growth is likely to remain low for some time, and a return to a more normal pace is unlikely until 2013.
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