UK economy bounces back by 0.2% in April as pubs boost spending while housing market weakens

The UK economy has bounced back in April with gross domestic product (GDP) rising by 0.2% as consumer spending increased, official figures show.

GDP increased by 0.2% following a fall of 0.3% in March, according to the Office for National Statistics (ONS).

ONS director of economic statistics Darren Morgan said the GDP has “bounced back after a weak March” with bars and pubs “comparatively strong” in April “while car sales rebounded and education partially recovered from the effect of the previous month’s strikes.”

He added: “These were partially offset by falls in health, which was affected by the junior doctors strikes, along with falls in computer manufacturing and the often-erratic pharmaceuticals industry. House-builders and estate agents also had a poor month.”

The weak performance from house-builders and estate agents comes after surging interest rates which have risen to a 14-year-high of 4.5% and are expected to keep rising. The construction sector also reported a 0.6% decline in output for the month.

The latest figure was in line with forecasts for the month from economists, with Chancellor Jeremy Hunt saying the government is “growing the economy” and the IMF (International Monetary Fund) says “that from 2025 we will grow faster than Germany, France and Italy.”

He added: “But high growth needs low inflation, so we must stick relentlessly to our plan to halve the rate this year to protect family budgets.”

But Labour’s shadow chancellor Rachel Reeves branded today’s announcement as a “dismal low-growth record book of this Conservative government.”

She said: “The facts remain that families are feeling worse off, facing a soaring Tory mortgage penalty and we’re lagging behind on the global stage.”

Kitty Ussher, chief economist at the Institute of Directors, said April’s GDP data “shows a recovery in consumer-facing services compared to March” suggesting that households are increasing their levels of spending “even in the face of rising costs.”

She added: “Businesses in the consumer-facing sectors will be encouraged by today’s data. However, the Bank of England may interpret it as proof that their interest rate hikes have not yet dampened demand enough to reduce inflationary pressure, particularly when combined with yesterday’s strong labour market performance.”