UK recovery gains ground as industries start to grow
UK economic growth accelerated in the second quarter as all main industries showed expansion for the first time in three years, indicating Britain's recovery is gaining traction.
Gross domestic product increased 0.6pc from the first quarter, when it rose 0.3pc, the Office for National Statistics said in London. That matched analyst forecasts.
Services, production, construction and agriculture all grew, the first time that has happened since the third quarter of 2010. From a year earlier, GDP rose 1.4pc.
Bank of England governor Mark Carney is preparing to outline the Monetary Policy Committee's (MPC) approach to forward guidance on policy next month as he looks to cement the economic r ebound.
Threats to growth remain, both domestically from the government's fiscal squeeze and internationally from the tensions in the euro area and a slowdown in China, the world's second-largest economy.
"Evidence is building that the economy is gradually getting back on its feet," said Vicky Redwood, of Capital Economics in London. "The firmer signs make it all the more important that the MPC reassures the markets that interest rates will stay low even as the recovery gathers further momentum."
The pound erased its gain against the dollar after the data were published, and traded at $1.5303, down 0.1pc from the day before.
Elsewhere, German business confidence improved for a third month in July, according to the Ifo Institute. Its business climate index rose to 106.2 from 105.9 in June. Economists predicted an increase to 106.1.
In the UK, strengthening labour-market and retail-sales data in the past month have added to signs that the economy is on the mend. (Bloomberg)