The UK economy grew by 0.6 per cent in the first quarter of the year, the Office for National Statistics (ONS) has confirmed. Despite this, the final figure for growth last year was revised down slightly, from 1.4 per cent to 1.3 per cent. The ONS said that services were the main driver of growth in the latest quarter, with strengths in computer programming, wholesale, and advertising offsetting falls in rental companies and recruitment agencies.
Business investment came to around 0.9 per cent in the first quarter of the year, which was slightly higher than expected. However, the current account for trade slipped deeper into negative territory, with a balance of -£22.2bn. The UK economy declined by 0.1 per cent in April due to the ongoing Iran war, which has caused international trade disruption and raised concerns about the country's growth prospects.
City economists have warned that the Iran war could damage the UK economy's growth by up to 0.3 percentage points, while inflation could stay above 3 per cent for the rest of the year. The incoming Prime Minister, Andy Burnham, has promised to oversee the biggest transformation of British politics in a lifetime and has set out a 10-year plan to raise living standards through devolution and greater public control of utilities.