UK economy passes pre-crisis peak with growth of 0.8% in Q2

The UK economy expanded by 0.8% in the second quarter,above its pre-crisis peak, official statistics revealed today.

The latest figures from the Office for National Statistics (ONS) show the economy is now 0.2 percentage points ahead of its pre-crisis peak, which was reached in the first quarter of 2008, reports sister publication Investment Week.

In the last year, the ONS added the economy expanded by 3.1%.

The uptick in growth has surprised many, coming so soon after one of the worst ever financial downturns. From peak to trough in 2009, the economy shrank by 7.2%.

Azad Zangana, European economist at Schroders, said the reading is in line with consensus forecasts, making an interest rate rise all the more likely.

“While we expect a slight slowdown in growth in the second half of the year, the strong momentum that has been built should help broaden out the economic recovery further,” he said.

“Looking ahead, the Bank of England is closely examining the case for raising interest rates and looking for signs that spare capacity is being utilised. The latest GDP figures support this, along with the rapidly falling unemployment rate.

“However, falling average wages in real terms is likely to prompt a cautious approach.”