In a promising turn of events, the United Kingdom’s economy has officially exited recession in the first quarter of 2023, earlier than initially anticipated.
Official figures reveal that the economy experienced a notable growth of 0.6 percent between January and March, marking its fastest pace in two years.
It’s worth noting that the UK economy had entered a recession last year, following two consecutive quarters of contraction.
While Prime Minister Rishi Sunak celebrated the economic upturn, the Labour party cautioned against premature celebrations, emphasizing that it’s not yet time for a “victory lap”.
Speaking to the BBC, Bank of England Governor Andrew Bailey acknowledged signs of recovery in the UK economy, albeit noting that the momentum was not exceptionally robust.
Currently, interest rates are at their highest level in 16 years, resulting in increased borrowing costs for individuals seeking mortgages or loans. Simultaneously, savers are benefitting from improved returns on their savings.
The Bank of England’s latest assessment indicates that inflation is expected to near its target range over the coming months. Initially, this had prompted speculation of a potential rate cut in June. However, the stronger-than-anticipated growth figures have tempered these expectations.