Tuesday, September 27, 2022

British GDP grew 0.5% in May, more than expected

LONDON ( Associated Press) – Britain’s economy posted unexpectedly strong growth in May, with all three major components of output – manufacturing, construction and services – posting gains.

The Office of National Statistics said on Wednesday that gross domestic product grew 0.5% on the month, compared with forecasts for expansion of 0.1%. GDP fell 0.2% in April.

But the Confederation of British Industries (CBI) has warned that the numbers could be volatile. The May data was influenced by the celebrations of the 70th anniversary of Elizabeth II’s reign and an additional holiday.

“This noise will continue to obscure the true state of the economy for months to come,” Ben Jones, chief economist at the CBI, said in a statement. “In fact, CBI polls and real-time data point to moderate economic momentum.”

Britain’s sluggish economic growth has become a central issue in the race for prime minister, with all candidates vowing to cut taxes to encourage business investment. Eight candidates are vying to replace Prime Minister Boris Johnson, who announced his resignation last week after a series of scandals undermined his credibility.

In a sign of headwinds facing the economy, the statistics office said output at consumer-facing companies fell 0.1% in May as inflation hit household budgets. The consumer price index rose 9.1% in May, the biggest jump in 40 years.

Overall, the service sector grew 0.4% on the month, the statistics office said. The increase was driven by healthcare spending as people booked more appointments with general practitioners after COVID-19 restrictions were relaxed.

Services account for 80% of British GDP.

Output from manufacturers and other manufacturing industries rose 0.9% in May and construction jumped 1.5%.

Nation World News Desk
Nation World News Deskhttps://nationworldnews.com
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