Britain’s economy grew 0.6% in the second quarter of 2024, in line with economists’ expectations and building on a rapid 0.7% recovery in the first quarter of the year after a shallow recession in the second half of 2023, official figures showed.
In June alone, Britain’s level of gross domestic product was unchanged, also in line with economists’ forecasts in a Reuters poll, and compared with a year earlier it was 0.7% higher, the Office for National Statistics said on Thursday.
At the start of the month the Bank of England raised its annual growth forecast for 2024 to 1.25% from 0.5% due to a stronger-than-expected start to the year and an expectation of 0.7% quarter-on-quarter growth in the three months to June.
But it was less upbeat about the outlook for the remainder of 2024, seeing growth slow to 0.4% in the third quarter and 0.2% in the final three months of the year – which it views as closer to the economy’s underlying growth rate.
Britain’s economy has grown slowly since the Covid-19 pandemic. Only Germany, which was also hit hard by surging energy costs after Russia’s invasion of Ukraine, has done noticeably worse among the world’s largest advanced economies.
Prime Minister Keir Starmer said he wanted the economy to achieve annual growth of 2.5% when campaigning in the run-up to July 4’s election – a rate that Britain has not regularly reached since before the 2008 financial crisis.
Finance minister Rachel Reeves set a more formal target that Britain should enjoy the fastest per capita growth in gross domestic product among the Group of Seven advanced economies for two consecutive years.
Thursday’s figures showed output per head in the second quarter of 2024 was 0.1% lower than a year earlier.
Growth in output per hour worked has slowed in most advanced economies since the late 2000s – limiting increases in living standards – and Britain’s long-standing domestic headwinds from low business investment were exacerbated by the public’s 2016 vote to leave the European Union.