UK economy posts surprising growth in Q2 as households keep spending

LONDON — The UK economy beat expectations with growth of 0.2% in the second quarter, led by household consumption, the Office for National Statistics said on Friday.

Economists polled by Reuters expected UK GDP to remain flat in the second quarter, after posting a surprise 0.1% growth in the first quarter, as the Bank of England’s monetary policy tightening and the Persistent inflation began to limit demand.

The economy expanded 0.5% in June, beating a growth forecast of 0.2%. This is followed by monthly GDP growth of 0.1% in May and 0.2% in April.

Production was boosted by growth of 1.6% in manufacturing and 0.7% in production in the second quarter, while services grew by 0.1%.

The ONS noted strong growth in household and government consumption in terms of spending. Both faced pricing pressure in the quarter, although this moderated from the prior three-month period.