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U.K. Economy Exits Recession, Signals Fragile Recovery

Britain's GDP growth in early 2024 marks the best performance since the pandemic, yet underlying economic challenges persist.

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A customer is served outside an Italian restaurant in the Soho area of London on June 18, 2023. Recent data showed UK inflation slowed to a 13-month low in April, but remains elevated at 8.7 percent as soaring food prices offset weaker energy costs. (Photo by HENRY NICHOLLS / AFP) (Photo by HENRY NICHOLLS/AFP via Getty Images)

Overview

  • Britain's GDP rose 0.6% in Q1 2024, surpassing expectations and marking the strongest growth since 2021.
  • Despite the uptick, overall economic output remains just 1.7% above pre-pandemic levels, highlighting a slow recovery.
  • Sectoral performance varies, with services showing resilience while manufacturing and construction lag.
  • Political pressures mount as economic growth becomes a focal point ahead of upcoming national elections.
  • Economists caution that sustained recovery may still be at risk from inflationary pressures and global instability.