- Treasury spokesman
Britain's economy expanded on a more rapid pace than previously estimated in the second quarter, outperforming the U.S., Japan, as well as European countries. The U.K. economy grew 3.2% in the three months through June compared with the same period last year, slightly higher than the 3.1% projection, while the quarterly pace of GDP growth remained flat, despite slightly stronger output in the services sector. The data confirmed that the U.K. had finally climbed out of its longest downturn since the war with the economy being 0.2% above the pre-crisis peak. Unlike the previous estimates, the second revision does not include the data on the income side of GDP, which will be published late September due to changes to the UK National Accounts methodology. The services sector, which accounts for around 78% of UK economic activity, saw a broadbased growth, with increases in each of the four main categories. The sector grew 1% in the second quarter, the ONS said, while the annual growth rate of 3.6% in the sector was also the best performance in just over six years. The services sector is now 3% above its previous high in the first quarter of 2008, indicating the U.K.'s economic recovery is still being led by consumer spending. In contrast, Britain's manufacturing output is still 7.5% below its pre-recession peak. Concerning the outlook for the third quarter, the Bank of England's August estimates suggest a slightly slower growth of 0.7%, while the 2014 annual growth rate was revised up to 3.5%, from 3.4% projected in May.
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