The United Kingdom’s economic recovery from recession in the first quarter was stronger than initially estimated, according to official data released on Friday, providing a slight boost to embattled Prime Minister Rishi Sunak ahead of next week’s election.
The Office for National Statistics (ONS) reported that gross domestic product (GDP) grew by 0.7 percent in the first three months of the year, an upgrade from the previous estimate of 0.6 percent and surpassing market expectations of no change.
This unexpected positive economic recovery comes as Sunak’s Conservative Party trails significantly behind the main opposition Labour Party, led by Keir Starmer, ahead of the nationwide polls on July 4.
A Labour victory would end 14 years of Conservative rule, with Sunak having been at the helm since 2022.
The UK economy had experienced slight contractions for two consecutive quarters in the latter half of 2023, thus entering a technical recession amidst elevated inflation and a prolonged cost-of-living crisis.
The ONS had previously indicated that the economy stagnated in April with zero growth, impacted by poor weather conditions that negatively affected construction firms and retailers.
Last week, the Bank of England maintained its key interest rate at a 16-year high of 5.25 percent, despite UK inflation returning to its 2 percent target. Until recently, there had been expectations of a rate cut at the next monetary policy meeting on August 1.
Inflation in Britain has slowed significantly in recent months, reaching a near three-year low, according to recent data. The Consumer Prices Index dropped to 2.0 percent in May from 2.3 percent in April.
UK inflation last met the BoE’s 2.0-percent target in July 2021 before surging in a cost-of-living crisis largely driven by rising energy and food prices.
Prices, however, continue to rise, adding to the significant increases seen in recent years.