2Q growth boosted by construction sector, UK

2Q growth boosted by construction sector, UK
Published: 23 July 2010

Britain’s economic recovery raced ahead from April to June as the biggest jump in construction in half a century and a surge in services propelled growth at its fastest pace in four years, reports Reuters.

GDP jumped 1.1 per cent in the second quarter, data from the Office for National Statistics showed. That was almost twice the rate analysts expected and nearly four times the pace of growth in the first quarter.

Friday’s figures suggested Britain’s recovery was on a firmer footing than many feared, easing concerns that deep public spending cuts could drive the economy back into recession, though some said growth may lose momentum in the third quarter.

A breakdown of the figures showed the services sector enjoyed its fastest growth in three years, expanding by 0.9 percent on the quarter -- three times as fast as in Q1 and contributing 0.7 percentage points to growth.

Manufacturing grew 1.6 per cent, its biggest rise in more than 10 years.

Construction leapt 6.6 per cent on the quarter – its fastest rate since 1963, rebounding after weather-related weakness at the start of the year.

However, analysts urged caution in interpreting the figures, which were based for the first time based on a new monthly survey.