United Kingdom economy picks up some speed, Brexit hurdles ahead

GDP latest Hot weather and a shopping surge gave UK a GDP boost

GDP latest Hot weather and a shopping surge gave UK a GDP boost

"The economy picked up a little in the second quarter with both retail sales and construction helped by the good weather and rebounding from the effects of the snow earlier in the year", said Rob Kent-Smith, ONS head of national accounts.

The ONS said weather had been a factor in economic performance; poor weather contributed to low growth in the first quarter while better weather this summer provided a boost to areas such as retail and construction in the second quarter.

The UK economy grew by 0.4 % in the second quarter of 2018, up from 0.2% in the previous quarter, according to the latest figures from the Office for National Statistics. United Kingdom economic growth lags that of other major industrialized nations amid uncertainty over Britain's departure from European Union.

On a yearly basis, GDP advanced 1.3 percent versus 1.2 percent growth seen a quarter ago.

World Cup revellers sent the cash tills ringing as manager Gareth Southgate's England team progressed to the semi-finals at the tournament held in Russian Federation.

The United Kingdom outperformed the Eurozone, which grew by 0.3 percent last quarter.

Ruth Gregory, senior economist at Capital Economics, said growth would have been weaker had it not been for a big contribution from inventories, offsetting a "whopping" 0.8 percentage-point drag on growth from net trade, which was still down 0.5pp even excluding the volatile valuables component. Britain's government has yet to agree a divorce deal with Brussels and has stepped up planning for the possibility of leaving the bloc without any formal agreement.

However, the ONS added that underlying growth remained "modest".

Quarterly consumer spending growth picked to 0.3% from 0.2%, with businesses also defying Brexit-related uncertainty to rebound to 0.5% from a 0.4% decline in the first quarter.

However, the growth slowed towards the end of the quarter, with the monthly data showing that growth in June had slowed to 0.1 per cent, down from 0.3 per cent in May and short of expectations. More recently, wages have risen more quickly than inflation but there have been signs that household finances remain stretched. Against the euro, the pound was up 0.1% at 1.11.

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