Responding to the February growth figures, Julian Jessop, Economics Fellow at the Institute of Economic Affairs said:

“The news that the UK economy grew by 0.5% in February is a welcome surprise but should come with plenty of health warnings.

“For a start, monthly GDP data are notoriously volatile and often revised. A sharp correction is possible in March and especially in April, when the increases in taxes and other business costs in last October’s Budget actually kick in.

“Moreover, the official data are far stronger than indicated by the latest business and consumer surveys. These do suggest that the economy has picked up a little, but nowhere near this strongly.

“February’s data may also have been flattered by some special factors. In particular, there was a 2.2% jump in manufacturing output, which again is hard to square with the industry surveys.

“This may have been boosted by activity brought forward to beat new US tariffs, or just reflect the usual noise in these data. Either way, a global trade war remains a big downside risk for the rest of the year.

“That said, there are some encouraging signs in the data too. Above all, consumer spending on services is rising strongly. With real wages still growing at a decent pace and household savings relatively high, the UK economy is still likely to grow by around 1% over the year as a whole.

“However, sentiment is clearly fragile, especially with the labour market weakening, taxes expected to rise further, and the US-China trade war escalating.

“Overall, the UK economy looks set to avoid the outright recession that some feared, but the strong start to the year is unlikely to be sustained.

“In the meantime, the Government needs to do more to restore consumer and business confidence and break free from the doom loop, while liberating the private sector from unnecessary costs and red tape.”