Figures expected to show UK economy grew in February, but only just

A survey of City economists for Refinitiv suggest GDP in February rose by 0.1%, giving the UK its first consecutive months of growth since August to September

Figures Friday morning are expected to show the UK economy is continuing its recovery from recession with growth in February: but is still barely growing. (Victoria Jones/PA)

PA Wire

Daniel O'Boyle, Business news editor @Dan_O_Boyle11 April 2024

Figures Friday morning are expected to show the UK economy is continuing its recovery from recession with growth in February: but only just.

A survey of City economists for Refinitiv suggest GDP in February rose by 0.1%, giving the UK its first consecutive months of growth since August to September.

Crucially, a second quarter of growth, even minimal growth, would make it overwhelmingly likely that the UK exited its end-of-2023 recession in the fastest possible time, making it one of the smallest official slumps in history.

But the figures still remain a far cry from the levels of growth seen in the 2000s, or those seen across the Atlantic.

Surveys suggest that the growth will be helped by long-awaited rebounds for the UK’s struggling construction and manufacturing sectors. The S&P PMI surveys for February suggested that manufacturing and housebuilding were both close to flat for the month after both had been in deep declines ever since 2022. The dominant service sector, that had carrier the UK economy during growth months in 2023, is expected to rise by a more modest 0.1%.

Kathleen Brooks, research director at XTB, said the slower service growth “could lead to some fears that the UK consumer is struggling”.

She said: “On the one hand this could make future economic growth less certain, on the other hand it could make the BOE verge towards cutting interest rates sooner rather than later, which could be good news for the FTSE 250.”

Matthew Ryan, head of market strategy at financial services firm Ebury, said: “Data out of the UK in the past few weeks continues to paint a picture of a recovery in economic activity, led by the services sector, and very gradual disinflation to levels that are still above Bank of England targets.”

“Both the business activity PMI numbers and the January GDP figures suggest that expansion returned at the beginning of the year, and while the Q1 growth figures won’t be released until early-May, this Friday’s data for February may further support this hypothesis.”