“This rebound in GDP suggests that the UK took its first step towards exiting recession in January as strong retail activity helped boost overall output.
“January’s recovery may have been followed by a more muted performance in February with the significant wet weather likely to have suppressed activity, despite a boost to incomes from lower inflation.
“While these figures suggest the UK is on track to exit recession this quarter, the squeeze from high interest rates and persistent labour shortages may mean that the recovery is more downbeat than the OBR is predicting.
“This data won’t alter the expectation that interest rates will remain on hold this month. With the economy struggling and inflation slowing, the case for loosening policy by the summer is growing.”
ENDS
Notes to editors:
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