Skip to content 
Search

Latest Stories

UK economy rebounds despite soaring inflation

The broad rebound was driven by a bounceback in construction, manufacturing and services.

UK economy rebounds despite soaring inflation

Britain's economy rebounded in May, official data showed Wednesday, dampening fears of a slowdown despite surging inflation and rising interest rates.

Gross domestic product expanded 0.5 per cent, the Office for National Statistics said in a statement, beating expectations of zero growth.


"The economy rebounded in May with growth across all main sectors," said Darren Morgan, ONS director for economic statistics.

The broad rebound was driven by a bounceback in construction, manufacturing and services.

That followed a 0.2-per cent decline in April, which was revised up from a 0.3-per cent contraction.

"Health was the biggest driver, with many more people seeing GPs, despite test and trace and the vaccination programmes winding down," added Morgan.

"Road hauliers also had a busy month while travel agencies fared well with pent-up demand for summer holidays.

"There was widespread growth across manufacturing after several tough months while construction also fared well with housebuilding and office refurbishment driving growth."

The Bank of England has hiked interest rates five times since December in a bid to tame runaway inflation, which has sparked a cost-of-living crisis in Britain.

UK inflation spiked in May to a 40-year peak of 9.1 per cent, a level set to hit double figures this year on soaring energy and food prices according to the BoE.

The UK government meanwhile welcomed Wednesday's upbeat data.

"It's always great to see the economy growing but I'm not complacent," said finance minister Nadhim Zahawi.

"I know people are concerned so we are continuing to support families and economic growth."

Zahawi is among eight Conservative MPs vying to become Britain's next prime minister following last week's resignation of scandal-hit Boris Johnson as Conservative Party leader.

Capital Economics analyst Paul Dales said the economy was "resilient" but warned over the ongoing risk of recession due to rampant price rises.

Poisoned chalice? 

"It is far too soon to conclude that the economy will be able to get through this period of unusually high inflation largely unscathed," Dales said.

"With real household disposable incomes set to fall further in the third quarter, a recession is still a real risk.

"That may mean the economy proves to be a poisoned chalice for whoever wins the race to be the next Prime Minister."

Many economists fear the economy could also stumble in June due to the long bank holiday weekend that marked Queen Elizabeth II's Platinum Jubilee.

Wednesday's data could encourage the BoE to implement a half-point rate hike at its next meeting in August, Dales added.

The central bank in June lifted the cost of borrowing by a quarter-point to 1.25 per cent, the highest level since the global financial crisis in 2009.

Britons, like others in many countries, are grappling with soaring consumer prices fuelled partly by fallout from Russia's war on Ukraine, which has destabilised energy markets.

(AFP)

More For You

Police probe hate crime over migrant effigies bonfire in Northern Ireland

Models depicting migrants wearing life jackets in a small boat alongside two banners reading 'Stop the boats' and 'Veterans before refugees' are displayed on top a bonfire in Moygashel, Northern Ireland, on July 9, 2025. (Photo by PETER MURPHY/AFP via Getty Images)

Police probe hate crime over migrant effigies bonfire in Northern Ireland

POLICE in Northern Ireland have launched a hate crime investigation after a bonfire topped with effigies of migrants in a boat was set alight in the village of Moygashel, County Tyrone.

The incident, which took place on Thursday (10) night, has drawn widespread condemnation from political leaders, church officials, and human rights groups.

Keep ReadingShow less
Navratri festival in Wembley

A similar event held at the same site last year resulted in a planning enforcement notice being issued due to complaints of noise and disturbance.

Getty Images

Navratri festival in Wembley faces objections

A PROPOSED 10-day Hindu festival in Wembley, north London, has drawn objections over concerns about noise and disruption in the area.

Asian Events Media (AEM) has applied to Brent Council to host the Navratri celebration at Alperton Studios from September 22 to October 1, according to The London Standard.

Keep ReadingShow less
Pakistan rejects claim of China’s role in border clash

Asim Munir

Pakistan rejects claim of China’s role in border clash

PAKISTAN’S army chief Field Marshal Asim Munir on Monday (7) rejected Delhi’s allegation that his military received active support from longtime ally China in its conflict with India in May.

The Indian Army’s deputy chief, Lieutenant General Rahul Singh, said last week that China gave Islamabad “live inputs” on key Indian positions.

Keep ReadingShow less
Modi courts Latin nations to expand trade relations

Christine Kangaloo awards Narendra Modi with the Order of the Republic of Trinidad and Tobago last Friday (4)

Modi courts Latin nations to expand trade relations

INDIA’S prime minister, Narendra Modi met Argentine president Javier Milei in Buenos Aires last Saturday (5), urging the expansion of New Delhi’s preferential trade deal with South America’s Mercosur bloc.

The bilateral talks with Milei were the latest in Modi’s whistle-stop diplomatic tour culminating in the summit of Brics emerging economies which began last Sunday (6) in Brazil.

Keep ReadingShow less
Minister 'open to talks' on British Sikh regiment

Lord Coaker (Photo: UK Parliament)

Minister 'open to talks' on British Sikh regiment

A FRESH parliamentary initiative to establish a dedicated Sikh regiment within the British Army has gained momentum in the House of Lords, with defence minister Lord Coaker expressing willingness to engage in further discussions about the long-debated proposal.

The issue was raised in the House of Lords on Monday (7) by Labour peer Lord Sahota, who asked whether there had been any progress on long-standing calls for a Sikh regiment.

Keep ReadingShow less