GDP figures - PwC's senior economic adviser comments

In response to new GDP data released today, Andrew Sentance, senior economic adviser, PwC, said:

"UK GDP rebounded in the second quarter, as expected, with 0.7% growth on the previous quarter and a 2.6% rise on a year ago. In five out of the past six quarters, the UK economy has grown at a quarterly rate of 0.7% or more - which suggests the recovery is well-established and the weakness in the first quarter was caused by temporary factors.

"Private sector services - which make up over half of GDP - are leading the recovery. Activity in retailing, hotels, restaurants and related services is 4.5% up on a year ago and the output of transport services has risen by 3.7%. Business and financial service growth in the past year is also over 3%. Manufacturing output and public services are much more sluggish, with output growing by just 0.5% or so over the past year. This pattern of growth suggests that consumer spending is providing more momentum to the UK economy now as wage increases pick up and inflation remains around zero.

"The UK remains on course to grow at 2.6% in 2015 as a whole, and PwC forecasts suggest that Britain will head the G7 growth league for the second year in a row. Against this background, higher interest rates should be firmly on the MPC agenda in the second half of this year."

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Gill Carson
PwC | Media Relations Manager
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PricewaterhouseCoopers LLP
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