The UK economy grew faster-than-expected in May, official data showed on Wednesday.
According to the Office for National Statistics, GDP grew by 0.5% in May, following a decline of 0.2% in April, which was revised up from an earlier estimate for a 0.3% fall. Analysts had forecast a rise of just 0.1% for May.
In the three months to May, GDP rose by 0.4%, and by 3.5% in the year to May.
The UK is in the midst of a cost-of-living crisis, with inflation now at a 40-year high of 9.1% Yet despite that, services, production and construction all reported growth during the month.
Services output grew by 0.4%, boosted by strong demand for human health and work activities, which rose 2.1% following a large rise in GP appointments. Output in consumer-facing services eased 0.1%, however, after retail trade fell 0.5%.
Production grew by 0.9%, driven by growth of 1.4% in manufacturing and 0.3% in electricity, gas, steam and air conditioning supply. Construction rose 1.5%, a significant rebound from April’s 0.3% growth.
Gabriella Dickens, senior UK economist at Pantheon Macroeconomics, said: “May’s GDP data have not changed our expectations for a contraction in the second quarter. We estimate that the additional bank holiday for the Queen’s Jubilee, which will be treated as a special event by the ONS and thus will depress the seasonally adjusted data, will cause GDP to fall by around 1.5% month-to-month in June.
“In addition, weak consumer confidence suggests that people probably didn’t borrow enough, or cut their savings by enough, to maintain their real spending while their real incomes dropped.
“Nevertheless, a recession remains unlikely.”
