The U.K. economy grew at a faster pace in the second quarter, weathering the uncertainty stemming from the run-up to the EU referendum.
Gross domestic product expanded 0.6 percent in the three months to June from the previous quarter, preliminary estimates from the Office for National Statistics showed Wednesday.
This was faster than the 0.5 percent growth forecast by economists and 0.4 percent expansion seen in the first quarter.
"Any uncertainties in the run-up to the referendum seem to have had a limited effect," ONS Chief Economist Joe Grice said.
"Very few respondents to ONS surveys cited such uncertainties as negatively impacting their businesses."
The preliminary estimate take into account only the production side of GDP.
The dominant services sector posted a 0.5 percent expansion and industrial production increased by 2.1 percent. In contrast, construction dropped 0.4 percent and agriculture by 1.0 percent.
On a yearly basis, GDP rose 2.2 percent in the second quarter versus the expected growth of 2.1 percent. In the first quarter, the annual growth figure was 2 percent.
The quarterly growth was largely driven by strong performance in April and activity started to weaken ahead of the June 23 referendum.
Scott Bowman, a UK economist at Capital Economics, said he envisaged an economic stagnation in the second half of this year, rather than a full-blown recession.
The Bank of England is expected to cut Bank Rate next week and the Chancellor is ready to "reset" fiscal policy if warranted by economic data, he noted. This, along with a fading of uncertainty, should see growth start to accelerate at the start of 2017, Bowman added.
After the release of negative business survey results, BoE's Martin Weale favored an immediate stimulus. As monetary policy works with a delay, even an action in August is unlikely to give quick boost to the economy, he said in an interview with the Financial Times.
Bank of England Andrew Haldane has also signaled favor for a significant monetary stimulus in August.
Survey data released since June 24 showed a sharp deceleration in activity and confidence. Business confidence plunged to its lowest level in seven-and-a-half years, after the surprise "Brexit" vote, according to Industrial Trends survey from the Confederation of British Industry.
Another CBI survey today revealed that retail sales declined in July more rapidly than at any time since January 2012 as consumer confidence weakened following the EU referendum.
A closely-watched survey by Markit showed last week that the U.K. private sector activity contracted at the steepest pace since early 2009, post-Brexit.
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April 24, 2026 15:15 ET Economics news flow was relatively light this week even as the conflict in the Middle East continued, raising concerns for policymakers. In the U.S., spending data, initial jobless claims and pending home sales were the highlights. Business confidence in the biggest euro area economy was in focus in Europe. Inflation data from Japan gained attention in Asia.