UK Economy Shows Resilience in Q2, But Slower Growth Ahead

The United Kingdom's economy showed resilience in the second quarter, with GDP rising by 0.4% quarterly. This growth was driven by private consumption and business investment, while government spending had a negative impact.

According to Standard Chartered, this outturn demonstrates the UK's economic resilience despite headwinds from higher energy prices and uncertainty in the Middle East.

The bank also noted that monthly data pointed to 0.3% growth month-over-month in June, primarily driven by services activity.

However, Standard Chartered expects a further slowdown in the second half of the year, with growth easing to 0.2-0.3% quarterly in Q3 and Q4.

The bank has raised its full-year growth forecast to 1.3%, but still expects the Bank of England (BoE) to keep interest rates on hold this year due to restrictive rates and inflation data that is 'well behaved'.