Second-quarter economic growth upgraded to 0.7%

The UK economy grew more quickly than initially thought during the second quarter of the year, official figures showed today.

The Office for National Statistics (ONS) said gross domestic product (GDP) increased by 0.7 per cent compared with the first three months of the year, up from its initial estimate of 0.6 per cent.

Growth was seen across all sectors of the economy, with small upward revisions across manufacturing, construction and parts of the dominant services sector.

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Today’s upgrade means second-quarter economic growth was more than double the 0.3 per cent expansion seen in the first quarter, raising hopes that the recovery is gathering pace.

However, Chris Williamson, chief economist at Markit, said “worrying signs” persist in the household sector, with incomes falling by 1.7 per cent in the first quarter, compared with previous estimates of a 0.3 per cent dip.

He added: “The latest decline is the largest since the first quarter of 1987 and is a salient reminder that the consumer is being squeezed by record low pay growth, and as such is unlikely to help drive economic expansion in any meaningful way until pay growth revives.”