“The warmer weather in May provided a welcome boost to businesses, with stronger consumer spending helping to drive growth in consumer-facing services. This momentum has likely carried forward to June and early July, supported by World Cup-related spending. However, while this should provide a tailwind for the services sector, it may not be enough to offset weakness across other parts of the economy.”
“The recent rise in energy prices, driven by a pick-up in tensions in the Middle East, could pose a risk to the growth outlook, with financial conditions also tightening as a result.
“UK GDP grew by 0.1% in May, driven by a recovery in the services sector. While activity is likely to have remained subdued in June, carryover from the strong first quarter means overall second-quarter growth is still likely to be positive. Underlying activity could pick up in the second half of the year if geopolitical headwinds ease and domestic economic policy becomes more certain.”
