We're now closing our coverage of today's UK GDP figures, which showed 0.2% economic growth in the second quarter of 2023.

Our writers were Adam Durbin and Aoife Walsh in London, with Peter Ruddick reporting from Nottingham, and chief economics correspondent Dharshini David providing analysis. The editor was Owen Amos.

Thanks for reading.

• The UK economy grew by 0.2% overall between April and June, after a surprisingly positive performance in the final month of the quarter

• A 0.5% rise in June's GDP figures was fuelled by a bounce back from the hit of an extra May bank holiday
• Another factor boosting the numbers was the manufacturing sector (in particularly the car industry) according to the ONS
• The data points to a trend of largely sluggish growth, although forecasts still anticipate we will avoid a recession (when the overall economy shrinks over a six-month period)
• The government hails the GDP figures as good news and says their plans are working - while Labour says the low growth proves the economy is still flatlining
• Economists have said there are some positives to be taken, but have also predicted interest rates will continue to rise as there are indications inflation is set to remain high

The chief economist at a leading business group says the 0.2% growth in the second quarter highlights the "resilience of the UK economy".

But Ben Jones also says Confederation of British Industry (CBI) surveys indicate the "foundations for growth remain fragile".

He explains businesses remain uncertain about demand from their customers - on top of the growing cost of borrowing and ongoing challenges for some firms to find skilled workers.

Jones notes that government spending will remain restricted and interest rates high for the "foreseeable future".

He says this means British business need a "renewed focus" on improving productivity, which he describes as the "surest way to drive up growth and living standards in the UK".

Peter Ruddick
Reporting from Nottingham

There may be some cautious optimism after this morning's economic update - but for small business owners like Lorna Needham, it is way too early to celebrate.

She has run her small bakery in the Carlton area of Nottingham for almost 16 years, and she tells me "things are tough".

"It is hard work at the moment. I am incredibly lucky that we have been able to continue. We have a very loyal customer base. Electricity bills are still my biggest problem. It is so hard to keep motivated."

The shop is very hot on a nice day like today because Lorna can't afford to turn on the air con. She's also worried about the future of the Wilko store opposite.

"We always said that if Wilko closed we would have a problem," she says. "We are hopeful that somebody is going to take it over and we can continue to trade ourselves."

Prime Minister Rishi Sunak has reacted to today's figures, describing them as "good news".

Writing on social media, external, he says: "At the beginning of the year I made growing the economy one of my top priorities, and we are making progress.

"There’s still more work to do, but today’s figures show the plan is working."

There are some "positive surprises" within today's GDP figures, according to an economist from the National Institute of Economic and Social Research.

Paula Bejarano Carbo says the production and construction industries "grew strongly enough in June to pull the whole quarter ahead".

These figures "represent positive surprises to GDP", she says, but also notes the risk of high inflation and and possible interest rates hikes.

She also says NIESR continues to expect the UK to avoid a recession (two consecutive three-month periods of GDP falling) both this year and next.

We earlier gave you a month-by-month graph of UK GDP growth.

But in general, the quarterly figures are more important, as two three-month periods of shrinking GDP equals a recession.

As you can see, the UK economy has now grown for three quarters in a row - albeit by not very much.

David Baker, a partner at audit firm Mazars, says this morning's figures mean the Bank of England will probably continue to raise interest rates, to try and continue to push down inflation.

He says the Bank will be concerned by the "persistence" of rising prices. As a reminder, the Bank recently increased the base rate to 5.25%.

Suren Thiru, economics director at the Institute of Chartered Accountants in England and Wales, calls overall growth "underwhelming" and says June's improvement was merely a rebound from May's figures being hit by an extra bank holiday.

He goes on to warn about the data indicating a "worrying fragility in our economy" and says the UK is entering a "more challenging period" where inflation remains stubborn and interest rates high.

David Bharier, head of research at the British Chambers of Commerce, notes that while the economy is on course to avoid a technical recession, small movements in the expansion or contraction in GDP will not mean much for many businesses facing the most challenging trading conditions in years.

He says that while British firms are "very adaptable", they are hoping for "clear direction" over interest rates and long-term plans to improve economic investment from the government and Bank of England.

Here's some reaction from the government's Chief Secretary to the Treasury, John Glen.

"If you look at what's happening in Germany where it's flattened, in Italy, where it's -0.3, it's not easy across the whole of the world economy at the moment," he tells BBC Radio 4's Today programme.

The combined effect of Russia's war in Ukraine and the Covid pandemic "can't be fixed in one lever from the from the Treasury".

Glen says inflation is a "major challenge to the resilience of the UK economy and setting the conditions for sustained growth thereafter".

"That means taking tough decisions to try and avoid a recession, which everyone seems to think we will be able to do, that wasn't the case nine and a half months ago when when we came into office," he adds.

Asked whether Brexit has played a role in the UK's low growth, he says: "The country made a decision [on Brexit] and my job as a government minister is to do everything I can to maximise the growth of the economy."

Image source, PA Media

As we've reported, the lack of bank holiday in June - compared to three in May - contributed to the relatively strong 0.5% growth in that month, the ONS suggests.

The ONS also says the good weather may have been a factor.

"There was anecdotal evidence from the monthly business survey that suggested good weather and an increase in live events boosted turnover for business in June," the report says., external

Here's a new chart showing recent UK GDP growth, on a month-by-month basis.

Strike action was the "largest downward drag" on the economy in June, ONS economic statistics director Darren Morgan says.

"The one I would pull out is the health sector with the four days of industrial action and strikes by junior doctors in June, contributing to... the largest downward drags on the economy," he tells BBC Radio 4's Today programme.

But Morgan says GDP figures for June were "a bit better than many expected".

Although conditions are still challenging for businesses, there were signs of stabilisation, he says.

He adds that the falling cost of materials helped ease the pressure on manufacturers.

A smaller proportion of businesses are reporting supply chain disruption and more businesses say they were able to get goods and services from within the UK - rather than relying on imports - Morgan says.

Low growth in the UK - but it's worse in Germanypublished at 07:57 British Summer Time 11 August 2023

07:57 BST 11 August 2023

Dharshini David
Chief economics correspondent

No country’s had it particularly easy the past few years.

While the UK has yet to return to the level of output seen just prior to the pandemic, and is burdened by particularly stubborn inflation - we’re not having the worst 2023.

Countries measure GDP slightly differently, but Germany saw no growth in the last quarter, after shrinking in the previous two.

France registered expansion of 0.5% between April and June - but largely as the sale of one big cruise ship added to its export tally.

Meanwhile, the US has its buoyant consumers to thank for faster growth.

As for the rest of the year, our outlook is patchy - but some economists feel the picture in the eurozone for the rest of the year may be even weaker, and some worry about a (mild, short) recession there.

But Hunt's Labour counterpart, shadow chancellor Rachel Reeves, says the UK's economic growth is "still on the floor".

She says 13 years of "economic mismanagement under the Conservatives has left Britain worse off and trapped in a low-growth, high-tax cycle".

Reeves adds her party's plan for the economy will boost growth, increase wages and lower bills, so "working people are better off".

Image source, PA Media

We've just heard Chancellor Jeremy Hunt's reaction to the data, who says the actions the government are taking to combat rising prices are "taking effect".

He says this means the UK is "laying the strong foundations needed to grow the economy".

Hunt goes on to say the UK's central bank, the Bank of England, is predicting the economy avoids a recession - the technical term for when a country's GDP falls for two consecutive quarters.

He adds that if the government sticks to its plan the International Monetary Fund says the UK will grow faster than Germany, France and Italy in the long-term.

The ONS also provides data on how individual areas of the UK's economy are faring.

These figures are complex, but the headlines are the UK's production sector (which includes industries like pharmaceuticals, farming and mining) performed best by growing by 1.8% in June.

This was mainly driven by a 2.4% expansion in the manufacturing sector, indicating the cost of materials being used to make products is falling, the ONS says.

The biggest contribution came from the car industry, with strong performance in the production of vehicles, trailers and semi-trailers.

The construction sector grew by 1.6% in June, with both new and maintenance work expanding overall.

The news for the UK's services sector (which includes areas like IT, estate agents and transport) was less positive, with 0.2% growth between April to June.

Services make up just under 80% of the overall UK economy, external, so they have a larger influence on GDP figures - which is a big factor for the overall low growth in the economy.

Some growth - but how do we turbo-boost prosperity?published at 07:34 British Summer Time 11 August 2023

07:34 BST 11 August 2023

Dharshini David
Chief economics correspondent

Image source, Getty Images

Those who could spend, did. Households with pandemic-era savings, or perhaps pay rises, were still able to treat themselves to non-essentials.

It’s that resilience in consumer spending, and a bounce back in manufacturing, especially of cars, that helped the economy to expand last quarter, defying fears.

Yet the UK remains an outlier amongst the G7 countries, our level of output is (just) below that of prior to the pandemic.

And as inflation and higher interest rates bite harder, the Bank of England predicts little growth in the next year or two.

Over half of homeowners have now been exposed to higher mortgage rates, and that’s climbing.

Some economists are fearful that, as in the 1970s, we may face stagflation - stagnant growth and stubborn inflation. This as many peoples incomes, once you strip away inflation and tax change, slide.

Despite these figures then, a crucial question for politicians remains in the run-up to the election: how do we turbo-boost prosperity?

A range of businesses said the lack of bank holiday in June, compared to May, helped the economy grow, according to the ONS.

In total, there were three bank holidays in the UK in May - including one more than normal, for the King's coronation.

"The economy bounced back from the effects of May's extra bank holiday to record strong growth in June," ONS director of economic statistics Darren Morgan said.

"Manufacturing saw a particularly strong month with both cars and the often-erratic pharmaceutical industry seeing particularly buoyant growth."

While the headline figure is for the second quarter - that is, a three-month period - the ONS also releases monthly figures.

In June, the UK's GDP grew by 0.5% overall.

This is stronger economic performance than recent months, although is still weak in overall terms.

June's figures followed a GDP fall of 0.1% in May and growth of 0.2% in April - taking the overall growth of the UK economy to 0.2% for the quarter.

The UK's GDP grew by 0.2% between April and June, the Office for National Statistics (ONS) has calculated.