Latest figures from the Office for National Statistics (ONS) have shown that the UK economy reportedly grew by 0.5% in May, marking a rebound in the gross domestic product (GDP) after a few tumultuous months.
As per reports, the latest data depicted an uptick from the previous estimates for March and April, to 0.1% and -0.2%, respectively.
The rise in GDP brings a wave of positivity for economists, who had earlier forecasted zero growth for May amid mounting pressure from the cost-of-living crisis, caused by high energy prices, and the country’s inflation rate hitting a 40-year high.
Darren Morgan, Director, Economic Statistics, ONS, stated that the rebound has resulted in growth across all sectors. Health emerged as the most significant driver as more people went to see their GPs (general practitioners) despite the slowing of vaccination programs, tests, and traces.
Travel agencies witnessed an upturn in business due to the pent up consumer demand for summer holidays, which brought about significant gains.
Road haulers also saw a busy month, while the manufacturing sector noted widespread growth after a sluggish period. Construction fared equally well as office refurbishments and housebuilding projects started again.
However, ONS reported that consumer-facing services, which represent around 80% of the country’s total output, fell by 0.1% from the previous month, pushed by the 0.5% drop in retail.
The figures came as the government’s focus shifted from the economy to leadership after the Conservative Party pushed it leader and the country’s former Prime Minister, Boris Johnson, out following mass resignations in the cabinet, including that of former chancellor Rishi Sunak.
Tony Danker, Director-General of CBI, has warned against the leadership distraction, and has also penned an open letter to the leadership hopefuls that the UK economy cannot be put on hold for two months until the election of a new PM.
It should be noted that Rishi Sunak is also one of the candidates entering the contest. He is the only one that has ruled out further and immediate aid to families, having rolled out a £37 billion (~USD 37.10 billion) relief package prior to his resignation.
Source credit: https://news.sky.com/story/uk-economy-returns-to-growth-after-two-months-of-gdp-contraction-ons-says-12650991