July 26, 2003	Saturday	Jumadi-ul-Awwal 25, 1424

LONDON, July 25: Prospects for a strong post-war recovery in the British economy were left in doubt on Friday after official figures showed that growth picked up only slightly in the second quarter, analysts said.

Gross domestic product (GDP) rose by 0.3 per cent in the three months to June from the previous quarter, when GDP had risen by 0.1 per cent, the National Statistics office said in a preliminary estimate to be reassessed next month.

The data suggested the British economy — the first of the Group of Seven rich nations to give a snapshot of second quarter GDP — is on the mend after growth slowed to the weakest pace in over a decade in the first quarter.

However, compared with the second quarter of 2002, growth slowed to 1.8 per cent from a pace of 2.1 per cent in the first quarter.

And many economists had been looking for a faster rebound in the wake of figures released a day earlier showing a surge in retail sales during June.

“These figures demonstrate that a prompt recovery in the UK economy cannot be taken for granted and that the policy option of further reductions in interest rates remains well and truly on the table,” said Investec economist Philip Shaw.

But he noted that the start of the quarter “was a period of significant uncertainty, coinciding with the invasion of Iraq”, and the economy did appear to have strengthened over the course of the second quarter.

“Hence we are reasonably confident that growth will gradually gather steam over the second half of the year,” said Shaw.

Nevertheless, the data prompted speculation that the Bank of England might act again soon to try to breathe new life into the economic recovery.—AFP