IHS Global Insight hikes GDP forecast after strong data

Following the strong services data released earlier, IHS Global Insight has bumped up its growth forecast for 2013 to 1.3 per cent (from 1.1 per cent) as it now anticipates 0.7 per cent growth in the third quarter.

This would mark the first time that the economy has had two successive quarters of growth exceeding 0.5 per cent since 2010. IHS Global Insight maintains a 2014 forecast of 1.9 per cent growth.

Howard Archer, chief UK and European economist:

The fact that the recent improvement has occurred across a wide range of sectors is particularly encouraging and reinforces hopes that the UK economy really is establishing a firmer footing.

The hope is that this recent firming economic activity underpins further, sustained improvement in business and consumer confidence, which in turn encourages businesses to invest and employ more, and consumers to spend more.