Food and Medical Industry Help Boost UK Economic Growth in 2Q

Dining and medical services have unexpectedly accelerated Britain’s economic growth by 4.8 percent after lockdown restrictions created a surge in customers.

The UK maintained its economic recovery with a growth accelerated by its further easing of lockdown restrictions last June.

The UK’s gross domestic product (GDP) recorded a growth rate of 4.8 percent by the end of the second quarter, only a bit short of the Bank of England’s prediction of 5 percent.

Economists had predicted a modest increase in GDP of 0.8 percent from 0.6 percent in May, but June recorded a jump to 1 percent.

Samuel Tombs, a UK economist at Pantheon Macro, said that this is because customer caution to the new coronavirus variants was expected to inhibit brick-and-mortar transactions.

However, the U.K. estimates that the boom may double inflation rates to 4 percent this year.

The dropping of lockdown restrictions boosted wages as establishments scurried for staff, increasing the cost of goods and services.

Yael Selfin, chief economist at KPMG U.K., warned that supply chains and labor markets may fail to keep up with the returning increase in consumer demand, “leading to an unwelcome burst of inflation.”

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