UK economy grows 4.8% as Covid restrictions ease

The UK economy grew by 4.8% between April and June, according to official figures, as most businesses emerged from lockdown.

Data from the Office for National Statistics showed that the expansion in gross domestic product (GDP) was fuelled by retail, restaurants and hotels.

Education also boosted the economy as schools reopened in the second quarter.

However, the figure was slightly below the 5% the Bank of England expected.

The UK economy is now 4.4% smaller than it was before the pandemic.

But Capital Economics said it expected the economy to return to pre-Covid levels later this year.

"We are comfortable with our view that monthly GDP will return to its February 2020 pre-pandemic size by October and that the economy may yet surprise most forecasters by emerging from the pandemic without much scarring," said senior UK economist Ruth Gregory.

Chancellor Rishi Sunak said: "Today's figures show that our economy is on the mend, showing strong signs of recovery.

"I know there are still challenges to overcome, but I feel confident in the strength of the UK economy and the resilience of the British people."

In April, non-essential retailers reopened, as well as gyms, hairdressers and outdoor dining. In May, pubs, restaurants and cafes were allowed to serve customers indoors, while theatres, galleries and cinemas were allowed to open their doors.

The main driver of growth was consumer spending, which rose by 7.3% over the quarter, ahead of expectations.