The UK economy's recovery from recession was stronger than previously thought, according to updated data from the Office for National Statistics (ONS).

Revised figures released on Friday morning revealed that the UK's gross domestic product (GDP) grew by 0.7% between January and March, up from the 0.6% growth estimated in May.

This growth marks a rebound from the recession experienced in the latter half of 2023, during which the economy contracted by 0.1% in the third quarter and 0.3% in the fourth quarter.

The improvement in growth was driven primarily by the services sector, which saw slightly stronger activity in professional services, transport, and storage. The services industry expanded by 0.8% for the quarter, compared to the previous estimate of 0.6%. Additionally, the production sector grew by 0.6%, while construction declined by 0.6% during the same period.

The quarterly growth was the strongest the UK has seen since the end of 2021. This news comes as a potential boost for Prime Minister Rishi Sunak ahead of next week’s General Election, following his previous pledge to grow the economy.

Mark Preskett, senior portfolio manager at Morningstar Wealth, commented: “The upward revision to the UK’s Q1 GDP is encouraging and further evidence that the UK economy is recovering. The services upgrade – to 0.8% from 0.7% – backs what we have been seeing in inflation data.”

However, the ONS reported earlier this month that the economy stagnated in April, with no growth due to dampened consumer spending caused by wet weather. Despite this, economists remain optimistic about growth for the current quarter.

Thomas Pugh, an economist at RSM UK, noted: “All the data suggests that the economy is set to continue to rise in Q2. We then expect growth to accelerate in the second half of this year and into 2025 as sharply lower inflation, tax cuts, and falling interest rates give households an income boost.” Photo by Jim Goldsmith, Wikimedia commons.