UK economy rebounds in Q2

    UK economy rebounds in Q2
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    The easing of Covid’s blockade in Britain has helped the economy recover. Photo: AFP / FILE

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    The easing of Covid’s blockade in Britain has helped the economy recover. Photo: AFP / FILE

    The British economy recovered 4.8% in the second quarter as the government began easing restrictions, according to official figures on Thursday.

    The strong recovery in growth has been fueled by consumer spending, while the government has continued to provide massive financial support by paying for example most of the private sector wages.

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    However, the recovery faces challenges as the job protection program ends in September and global supply chain bottlenecks persist. Gross domestic product fell 1.6% in the first three months of the year, the Office for National Statistics (ONS) added. a statement.

    “Today’s data show that our economy is evolving and showing strong signs of recovery,” Finance Minister Rishi Sunak said in a separate statement. However, the total production of the United Kingdom remains 4.4% lower compared to before the coronavirus pandemic or in the last quarter of 2019.

    The ONS, also providing its latest monthly data, said the UK economy grew by 1.0% in June, before the UK lifted almost all lock-in restrictions by July.

    Markets are scrutinizing both growth and inflation as nations emerge from lockdowns following the release of vaccines.

    Analysts warn that strong price increases could force central banks to raise interest rates earlier than expected, hampering the recovery.

    However, the pressure eased on Wednesday, after official data showed that inflation in the US had cooled slightly.

    The outlook could be difficult, analysts warn, as the government ends next month the leave program that kept millions of Britons at work during the pandemic.

    And while the Bank of England last week maintained its forecast for a 7.5% recovery in the British economy this year, returning to pre-pandemic levels, it had forecast a 5.0% recovery in the second quarter.

    Britain’s largest group of business lobbies, the CBI, warned of a difficult course after the positive data on Thursday.

    “Growth recovered in the second quarter as restrictions on activity were gradually lifted, stressing that tackling the pandemic goes hand in hand with supporting economic growth,” said CBI economist Alpesh Paleja.

    “However, there are challenges to recovery. Various supply congestion problems are likely to increase in the summer: shortages of raw materials and semiconductors, continued global supply chain downtime and staff shortages.

    “Britain ‘s recovery comes amid a rapid vaccination program in which nearly 89% of adults have received at least one dose and almost two – thirds are now fully crushed. The British government announced on Wednesday that it would offer coronavirus vaccines. in all 16 and 17 year olds, but not in younger healthy teens like in many other western countries.

    It comes amid concerns about the rapid spread of the Korana delta variant that has forced some states to reinstall lockdowns.

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