The latest growth figures in the UK hold significance not for signaling a sudden boom, as they do not.
Rather, they indicate a shift towards a return to a standard rate of growth, if maintained. Currently, the UK is experiencing joint-fastest growth among the G7 nations, on par with Canada, and surpassing the growth rates of France, Germany, Italy, Japan, and the United States.
However, given the sluggish growth experienced over recent years, what was considered normal growth prior to the late 2000s financial crisis now appears robust in comparison.
The economy has demonstrated remarkable resilience despite facing numerous challenges. Interest rates remained close to zero for 15 years before recent sharp increases brought them to their highest level in 16 years.
There is optimism that the positive start to 2024 could fuel momentum throughout the year, fostering increased confidence among businesses and consumers alike.
The anticipated decrease in inflation, nearing the target level of 2%, will further underscore this trend. While interest rates are expected to decrease in the summer, the strength of the growth figures may diminish the likelihood of a rate cut in the upcoming month.
Nevertheless, for many households, the return to normal growth may not translate into immediate prosperity.
In conversations across the country regarding the end of the recession, reactions range from resignation to amusement and frustration.
The most noticeable impact on households is the significant rise in prices, overshadowing considerations of inflation rates or GDP growth. Although per capita GDP has recently shown an increase for the first time in two years, it remains below levels observed two years ago.
Will individuals welcome this turning point with gratitude, or will they remain focused on years of subdued growth and diminishing living standards?
Navigating the economic aftermath of the most severe health crisis in a century and the worst energy crisis in a generation was always anticipated to be challenging. However, with the economy seemingly returning to a semblance of normalcy, there is reason for cautious optimism. Should this trend persist, it marks a notable improvement in economic conditions.