UK GDP (gross domestic product) increased by 0.8% in Q2 2014, the second
consecutive quarter on quarter increase of 0.8%. GDP was 3.1% higher in Q2 2014
compared with the same quarter a year ago. The economy has passed its pre-crisis
Office for National Statistics
[pdf] said output increased in two of the four
main industrial groupings within the economy in Q2 2014 compared with Q1 2014.
In order of their contribution, output increased by 1.0% in services and by 0.4%
in production. However, output decreased by 0.5% in construction and by 0.2% in
In Q2 2014 GDP was estimated to be 0.2% above the peak in Q1 2008. From peak
to trough in 2009, the economy shrank by 7.2%.
Gary Cooke, senior dealer at the forex specialists
commented: ""Bang on prediction growth, and an economy that has surpassed
its pre-crash peak - the headlines will reassure and rally Sterling in equal
"After some insipid retail sales figures and the Bank of England's MPC minutes
revealed Britain's rate setters to be less hawkish than thought, the Pound
slipped to a four-week low against the Dollar on
Thursday. But Friday's strong
if unsurprising GDP numbers will ensure the pound ends the week with a bang not
"With Britain's strong growth leaving most of the Eurozone in the dust, sterling
will continue to outpace the euro - - which this week touched a 23-month
low against the pound.
"But a closer look at the numbers reveal the UK economy is returning to type.
As the manufacturing and construction sectors shrink, services now account for
almost 80% of the British economy.
"With the hoped-for interest rate rise still some time off and inflation
outstripping wage rises, awkward questions remain about the quality of the
"So sterling's rally against Dollar is likely to be more modest, and there is no
guarantee it'll breach the $1.70 mark seen earlier this week."
chancellor, said: "Thanks to the hard work of
the British people, today we reach a major milestone in our long-term economic
Markit's chief economist, said: "Any
celebrations will of course also be marred by the fact that the milestone
reminds us that it has taken some six years for the country to merely regain the
economic might it had before the financial crisis struck."