Growth beats forecasts but cost pressures remain - Chamber

The UK economy grew by 0.4 per cent between April and June, according to the latest figures from the Office for National Statistics (ONS) - down from 0.6 per cent growth in the first three months of the year.

But business leaders said the better-than-expected growth demonstrates the resilience of businesses in the face of a host of cost pressures.

ONS data showed growth of 0.3 per cent month-on-month in June, against expectations for a flat performance, with firms across the service sector reporting buoyant trade thanks to extreme hot weather and the start of the World Cup football tournament.

It follows flat growth in May - revised down from an earlier estimate of 0.1 per cent - and a 0.1 per cent contraction in April.

Ruth Fleet (pictured), senior policy advisor at Greater Birmingham Chambers of Commerce, said: "June's GDP data once again shows the resilience of business in the face of geopolitical pressures.

"While the return to growth is undoubtedly a positive sign, our recent surveying of businesses across the Midlands found that eight out of 10 had suffered increased costs as a consequence of the US-Iran conflict.

"Additionally, 12 per cent of the exporters that responded to the survey told us that they had been forced to pause or withdraw from specific overseas markets.

"The government needs to go further to reduce cost pressures on UK businesses to ensure they can continue to grow, supporting employment in communities and growth in the economy overall."