U.K. exits recession with better-than-expected 0.6% GDP growth

Britain's economy grows by 0.6% in Q1 2024, boosting Prime Minister Rishi Sunak ahead of election.

Britain's economy grew by the most in nearly three years in the first quarter of 2024, ending the shallow recession it entered in the second half of last year and delivering a boost to Prime Minister Rishi Sunak ahead of an election.

The Office for National Statistics said gross domestic product expanded by 0.6% in the three months to March, the strongest expansion since the fourth quarter of 2021 when it grew by 1.5%.

A Reuters poll of economists had pointed to a 0.4% expansion of gross domestic product in the January-to-March period, after GDP shrank by 0.3% in the final quarter of 2023.

May 10th’s data will be welcome news for Mr. Sunak who said the economy had “turned a corner”, although the opposition Labour Party, which has a large lead in opinion polls, has accused Mr. Sunak and Finance Minister Jeremy Hunt of being out of touch to think voters are feeling better off.

"There is no doubt it has been a difficult few years, but today’s growth figures are proof that the economy is returning to full health for the first time since the pandemic," Mr. Hunt said.

The Bank of England, which held interest rates at a 16-year high on May 9, forecast quarterly growth of 0.4% for the first quarter of this year and a smaller 0.2% rise for the second quarter.

Sterling strengthened against the U.S. dollar immediately after the figures were released.