UK economy beats forecasts again to grow 0.1% in August

UK Economy Outperforms Expectations with 0.1% Growth in August 2024

Britain's Economic Performance in August 2024

By Andy Bruce

Oct 15 (Reuters) - Britain's economy grew unexpectedly in August, official data showed on Thursday, extending a run of resilient data that will encourage finance minister John Healey as he prepares his budget against a tough financial backdrop.

Gross Domestic Product Growth Surpasses Forecasts

The Office for National Statistics reported a 0.1% increase in gross domestic product in August, stronger than the consensus forecast in a Reuters poll of economists for a 0.1% drop.

Annual Growth Rate Reaches New Highs

The annual growth rate picked up to 2.1%, the strongest reading since October 2022 when output was bouncing back from the COVID-19 pandemic. Excluding that period, it was the strongest reading since December 2019.

Key Drivers of Economic Growth

Artificial Intelligence and Computer Programming

Adding to signs that the artificial intelligence boom is boosting Britain's economy, the ONS said computer programming was the largest contributor to growth in the three months to August.

Broad-Based Growth in Services Sector

But it also pointed to broad-based growth over the past year across the services sector that dominates Britain's economy.

Sector-Specific Performance in August

Manufacturing Sector

For August alone, growth was driven by the manufacturing sector which showed a 1.2% month-on-month surge, defying forecasts for a small drop in output.

Services and Construction Sectors

Services Sector

The services sector was flat, but still beat forecasts for a 0.1% dip, while construction output fell slightly.

(Reporting by Andy Bruce; editing by William Schomberg)