Mixed U.K. Growth Data Highlight Need For BOE Caution on Rates
- Economy rebounded in second quarter, as growth rate doubled
- Data for June suggest activity is already losing momentum
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The U.K.’s second quarter growth figures underlined why Bank of England officials felt compelled to act this month, but also highlighted the need for their cautious approach in coming months.
Data Friday showed the economy expanded 0.4 percent in the three months through June, double the rate of the snow-blighted previous quarter. GDP is now expanding at an annualized rate of 1.5 percent, the level policy makers say is the U.K.’s speed limit. That supports their argument that the first-quarter slowdown was a blip and backs up their decision to raise interest rates last week.