British economy rebounds strongly in first quarter of the year, ending ‘technical recession’

Andrew Bailey, Governor of the Bank of England, speaks during the Bank of England Monetary Policy Report press conference at the Bank of England, London, Thursday May 9, 2024. (Yui Mok/PA via AP)

LONDON (AP) — The British economy bounced back strongly in the first three months of the year, bringing to an end to what economists termed a “technical recession”, official figures showed Friday.

The Office for National Statistics said the economy grew by 0.6% in the first quarter from the previous three-month period, with broad-based strength across sectors. The increase was higher than the 0.4% predicted by economists.

It comes after two quarters of modest declines, which in the U.K. is defined as a recession.

Despite the quarterly increase, the British economy has barely grown over the past year. It has been hobbled by interest rates at 16-year highs of 5.25%.

There was hope Thursday that they may be on the way down soon. Bank of England Gov. Andrew Bailey indicated that a rate cut may be on the cards in June if inflation continues to trend downwards.

High interest rates — which cool the economy by making it more expensive to borrow — have helped ease inflation, but they’ve also weighed on the British economy.

The Associated Press