UK economy grows more than expected in February

(Sharecast News) - The UK economy grew more than expected in February, according to figures released on Friday by the Office for National Statistics. The economy expanded by 0.5% on the month, comfortably beating consensus expectations for a 0.1% increase. This followed no growth in January, revised up from a 0.1% decline.

Services sector growth was 0.3% in January following a 0.1% expansion the month before, and was the largest contributor to the monthly expansion in GDP.

The data also showed that production output grew 1.5% following a 0.5% drop in January, revised up from a 0.9% fall. Construction output grew 0.4% following a 0.3% contraction in January, revised down from a fall of 0.2%.

Liz McKeown, director of economic statistics at the ONS, said: "The economy grew strongly in February, with broad-based growth across both services and manufacturing.

"In services, we saw strong performances from sectors like computer programming, telecoms, and car dealerships. Meanwhile, in manufacturing, electronics and pharmaceuticals led the way, and car production also recovered after a run of weaker results.

"Looking at the broader picture, the economy has grown solidly over the past three months, with widespread gains across the services sector."

Ruth Gregory, deputy chief UK economist at Capital Economics, said the surprisingly strong 0.5% growth came as a pleasant surprise.

"But higher US tariffs, heightened uncertainty and April's rise in business taxes means February's resilience is unlikely to last."