U.K. gross domestic product grew by 0.2% in August, the Office for National Statistics estimated Thursday, partially recovering from a downwardly revised 0.6% contraction in July.
Services output was the main contributor to growth in August, adding 0.4% on the month to offset a fall in production output of 0.7% and a decline in construction output by 0.5%.
“While this data point is not yet consistent with a build-up of slack in the U.K. economy, it must be looked in the totality of the data, which shows early signs of a cooldown in the labour market and thus, lower inflation down the road,” said Mathieu Savary, chief European strategist at BCA Research.
“It does not change the outlook for the Bank of England and confirms that the Bank Rate does not have much upside from here, but will remain at current levels for an extended period.”
This is a developing story and will be updated shortly.
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