ONS report

Services help UK economy eke out small growth

London and financial services
The economy looks less like to tip into recession (pic: Terry Murden)

The UK economy grew by 0.2% in August – in line with expectations, according to the Office for National Statistics.

The data showed Britain’s huge services sector grew by a slightly stronger than expected 0.4% in August from July while manufacturing and construction shrank by 0.8% and 0.5%. August’s growth reduces the possibility of a recession.

“Our initial estimate suggests GDP grew a little in August, led by strong growth in services which was partially offset by falls in manufacturing and construction,” ONS director of economic statistics Darren Morgan said.

He added that the economy has also grown “modestly” over the past three months – mostly led by car manufacturing and sales as well as the construction sector.

However, it has revised July’s gross domestic product (GDP) further downwards.

Early official figures had already suggested that strikes and a summer washout led to a worse-than-expected contraction of 0.5% – but the ONS now believes July’s GDP actually fell by 0.6%.

Chancellor Jeremy Hunt said: “The UK has grown faster than France and Germany since the pandemic and today’s data shows the economy is more resilient than expected. While this is a good sign, we still need to tackle inflation so we can unlock sustainable growth.”

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