UK economy grew 0.7% in three months to April 2024

The UK economy grew 0.7% in the three months to April 2024, according to the latest GDP data from the Office of National Statistics (ONS).

The services sector, the largest part of the UK economy, saw the fastest growth, with output up 0.9% over the quarter. The best performing subsectors included professional, scientific and technical activities, transportation and storage, and IT and communications. Accommodation and the motor trade, however, saw small declines.

Production output also rose 0.7%; however, the construction sector saw a 2.2% fall in output over the quarter, with private commercial new work down 4.7%.

Monthly estimates from the ONS, however, reveal a slowdown in output with the economy experiencing zero month-on-month growth in April, down on the 0.4% growth seen in March. Despite the stagnation across the economy as a whole in April, the services sector also outperformed the rest of the economy with 0.9% growth.

0.9% growth in the services sector in April balanced out falls in output for both the production sector, which contracted 0.9%, and the construction industry, which experienced 1.4% decline. In part, the ONS has pointed to the wet weather throughout April as limiting the output of the some industries, particularly construction, retail and hospitality and tourism-driven sectors.

Slowed growth reported by the ONS for April, coupled with higher wage growth, has now dampened prospects that the Bank of England’s Monetary Policy Committee will lower interest rates this month.