Britain's Economy Rebounds, Yet Challenges Linger

The UK economy grew by 0.6% in Q2 2024, following a 0.7% increase in Q1. Despite strikes and adverse weather, the nation shows resilient growth. However, experts predict a slowdown in the latter half of 2024 due to high interest rates and slow wage growth, reflecting ongoing economic challenges.

Britain's economy expanded by 0.6% in the second quarter of 2024, matching economists' expectations and adding to a 0.7% recovery in Q1 after a mild recession in the latter half of 2023, official data indicated. In June, the GDP level was static, consistent with forecasts, and 0.7% higher compared to the previous year, stated the Office for National Statistics on Thursday.

'These figures confirm that the UK's recovery from recession gained momentum in the second quarter, despite strike action and adverse weather leading to stagnation in June,' said Suren Thiru, economics director at the Institute of Chartered Accountants in England and Wales. However, Thiru anticipates a slowdown in growth during the second half of 2024, citing high interest rates, supply constraints, and sluggish wage growth.

The market response to the data was minimal. Earlier this month, the Bank of England revised its growth forecast for 2024 to 1.25% from 0.5%, propelled by a robust start to the year and a projected 0.7% growth for Q2. Yet, it projects a more modest increase of 0.4% in Q3 and 0.2% in the final quarter, aligning closer with the economy's fundamental growth rate.

(With inputs from agencies.)