UK economic output surged by 0.4 per cent in May, exceeding expectations

Britain's economy grew 0.4 per cent in May, stronger than expected and offering new Prime Minister Keir Starmer a boost at the beginning of his mandate.

The 0.4 per cent rise, driven significantly by surging housing construction, was double the 0.2 per cent increase forecast by a Reuters poll of economists.

The Office for National Statistics announced across-the-board increases in activity pointing to services, manufacturing, and construction.

Most dramatically of all, construction rose 1.9 per cent—mainly driven by the housing sector.

The UK economy expanded by 0.9 per cent in the three months to May, its highest growth rate since Q3 2021, while it also came in hotter than consensus expectations for a 0.7 per cent rise.

Last month the Bank of England had forecast second-quarter growth of 0.5 per cent, highlightingthe unexpected strength of May's figures.

"The economy grew strongly in May with all the main sectors seeing increases," said Head of Economic Statistics at ONS, Liz McKeown.

She added that many wholesalers and retailers rebounded from a weak start in April to underpin good economic performance.

This can be very encouraging data to take on board for the new government amidst all the headwinds that would prepare it for the economic challenges ahead, demonstrating the resilience and recovery in many sectors of the economy.

(With inputs from Reuters)