{"text":[[{"start":7.6,"text":"The UK economy grew by 0.4 per cent in the second quarter, a relatively robust performance that suggests businesses are weathering threats including the Gulf-related surge in energy prices."}],[{"start":19.58,"text":"Thursday’s figure from the Office for National Statistics was in line with analysts’ forecasts and compared with a growth rate of 0.6 per cent in the previous three-month period."}],[{"start":29.68,"text":"In the month of June alone, GDP grew 0.3 per cent, with signs that the early weeks of the World Cup boosted activity for companies including restaurants, alcohol manufacturers and television producers. That followed zero growth in May — a downward revision from the previous increase of 0.1 per cent for that month."}],[{"start":48.8,"text":"The figures will come as a relief to new Prime Minister Andy Burnham as he pledges to broaden growth across more of the country and tackle the cost of living crisis."}],[{"start":57.76,"text":"The UK economy is expected to expand 1.1 per cent this year, according to the Bank of England’s latest forecasts, marginally below the 1.3 per cent pace recorded for 2025."}],[{"start":69.24,"text":"Nevertheless, rising inflation is set to take a toll on households’ real incomes, with the BoE predicting inflation will rise from 2.6 per cent to 3.2 per cent towards the end of the year."}],[{"start":81.04,"text":"Meanwhile, the Iran war continues to threaten the economy. Internal UK Treasury scenarios suggest that if the Strait of Hormuz remains badly disrupted until the end of the year, growth in 2027 could be dragged down to just 0.3 per cent, according to people familiar with the figures."}],[{"start":98.28,"text":"George Brown, senior economist at Schroders, said: “The UK economy has proven more resilient than many expected given the conflict in the Middle East.”"}],[{"start":107,"text":"But he added that “seasonal quirks” were probably “flattering” the quarterly figures and growth was likely to lose steam this year. The UK has tended to show a pattern of strong quarterly growth readings early in the year, with weaker outcomes as the year progresses."}],[{"start":121.08,"text":"While monthly growth in June was lifted by the World Cup, the hot weather had a more mixed impact, the ONS said. The second-warmest June on record came as a boost for retailers and recreation providers, but was cited as a negative in construction and in education, where some schools closed because of the heatwave."}],[{"start":138.36,"text":"The pound was steady at $1.35 immediately after the data. Market expectations for the next BoE meeting were little changed, with traders in swaps markets continuing to price around a one-in-four chance of the central bank raising rates in September."}],[{"start":155.52,"text":"The Bank is expected to make one quarter-point rate rise before the end of this year, but investors are divided over when that will come."}],[{"start":164.5,"text":"Quarterly growth was driven by an increase of 0.5 per cent in the country’s dominant services sector. The biggest contribution to that sector’s expansion came from information and communications, as well as professional and scientific output."}],[{"start":179.48,"text":"The construction sector expanded 0.3 per cent, while production was flat. Real GDP per head was up 1 per cent compared with the same quarter a year ago."}],[{"start":189.56,"text":"On the expenditure side, business investment jumped 1.7 per cent in the latest quarter, while there was a 0.3 per cent increase in real household consumption. Government consumption fell in the quarter, suggesting GDP growth has been private-sector led, a positive sign for the economy, analysts said."}],[{"start":207.88,"text":"“The fact that the private sector took over the baton this quarter is a good sign that stronger growth could be more sustainable than expected,” said Tomasz Wieladek at T Rowe Price."}],[{"start":218.2,"text":"But speculation about another tough Budget could take some of the steam out of the expansion in the lead-up to new chancellor John Healey’s first fiscal event on October 28, as it has in previous years, analysts warned. On top of this, the prospect of further increases in energy bills and elevated petrol prices is likely to pressure disposable incomes."}],[{"start":238.56,"text":"Responding to the figures, Healey said: “I know people are worried about the impact of the conflict in the Middle East on their cost of living, which has been too high for too long, and it has added pressure on British businesses."}],[{"start":251.32,"text":"“This is an active, hands-on government, putting British interests first — giving breathing space to those feeling the strain, making our country more resilient and bringing hope back.”"}],[{"start":261.42,"text":"Sir Mel Stride, the Conservative shadow chancellor, said: “Labour have mismanaged the economy with their tax and borrowing spree, leaving it weak and vulnerable to the effects of shocks like the Iran war. Yet Andy Burnham is gearing up to tax and borrow even more, doubling down on those failures.”"}],[{"start":277.48,"text":"Additional reporting by Emily Herbert in London"}],[{"start":280.92,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1786607296_6364.mp3"}