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UK gross domestic product (GDP) beat expectations in May, increasing 0.4%, as a result of better weather, according to data from the Office for National Statistics (ONS).
An unseasonably wet April dented consumer sentiment and hurt construction leading to the slight increase.
Construction grew at the fastest rate in almost a year in May, rising 1.9%, with house building and infrastructure projects boosting the industry.
The services sector, which dominates the UK economy and covers businesses such as hairdressers and hospitality, grew by 0.3% in May.
In the three months to May 2024, GDP also increased 0.9% compared with the previous three months.
That is the quickest pace for more than two years helped by strong growth in the services sector.
Analysts said the new figures, together with recent comments from Bank of England policymakers, meant the decision on whether interest rates will be cut next month was on a “knife-edge”.
Chancellor Rachel Reeves said economic growth was the government’s “national mission”, and “that is why this week I have already taken the urgent action necessary to fix the foundations of our economy”.
Ben Jones, CBI lead economist, said: “The latest data shows that the UK’s economic recovery is starting to put down roots. While growth in May was driven by a rebound in sectors such as retail and construction, which were hit by poor weather earlier in the spring, recent months have seen activity creeping up across a wide range of sectors.
“The new Labour government will benefit from some economic tailwinds going forward, with consumer confidence rising as lower inflation and strong wage gains support household incomes. However, many firms remain cautious about the near-term outlook. While the outcome of the election will help dispel some of the recent uncertainty, it could take a turning of the interest rate cycle for the recovery to really bed in.”
