UK economic growth, January 2024

LONDON — U.Okay. gross home product grew 0.2% in January, the Workplace for Nationwide Statistics stated Wednesday, as development output jumped greater than anticipated.

The headline determine was according to the forecast from economists polled by Reuters.

It follows a 0.1% contraction in December, whereas the U.Okay. economic system entered a shallow recession within the second half of final yr.

Building output rebounded from contraction to develop 1.1% in January, the ONS stated, however fell 0.9% over a three-month interval. The U.Okay.’s dominant companies sector recorded a 0.2% rise in January, offering the most important contribution to development, as manufacturing output fell 0.2%.

Regardless of recording month-to-month development, GDP was estimated to have shrunk 0.3% in contrast with a yr in the past in January, and fallen 0.1% over the three months to January 2024.

Jack Which means, chief U.Okay. economist at Barclays, described the figures as “not a vastly optimistic image, nevertheless it’s forward of the place we have been on the finish of final yr.”

“Industrial and manufacturing have been weak for the previous couple of prints, you’d anticipate some bounce-back from that in the long run,” Which means instructed CNBC’s “Squawk Field Europe” Wednesday.

“That is good to see, however we’ll need to see it on a extra extended foundation to know that it’s one thing sustained.”

The newest figures are in line with a forecast for a “gradual restoration in exercise” within the coming months, stated James Smith, developed markets economist at ING.

“We expect the decline in general fourth quarter GDP, which marked the second consecutive quarter of detrimental development and subsequently a technical recession, is unlikely to be repeated within the first quarter of 2024,” Smith stated in a notice.

The British pound was barely decrease towards the U.S. greenback and the euro following the discharge.