The UK economy will probably grow faster in 2014 than any other G7 economy, as it completely recovered the output lost as a result of the financial crisis. In the year’s second quarter, GDP grew by 0.8 per cent.

According to the Office for National Statistics, the country’s output rose above its previous record high in the first three months of 2008. The increase was the same as in the first quarter and in line with the economists’ estimates in a Bloomberg News survey. The International Monetary Fund (IMF) predicts that UK GDP growth will hit 3.1 per cent this year, almost twice as fast as the US.

Meanwhile, unemployment in the euro area fell in June, as the pain inflicted by the debt crisis and the longest-ever recession recedes. According to the EU’s statistics office, the jobless rate in the currency bloc fell to 11.5 per cent from the 11.6 per cent in May, less than the 11.6 per cent economists forecasted in a Bloomberg News survey.

In June, the European Central Bank (ECB) unveiled a range of measures, including a negative deposit rate for banks, to boost prices and growth.

In the meantime, euro area inflation slowed in July to the lowest level in almost five years as the Harmonised Index of Consumer Prices (HICP) came in at 0.4 per cent compared with 0.5 per cent in June. This is the weakest since October 2009 and below a median forecast of economists that called for a reading of 0.5 per cent.

Finally, an upbeat report published by the Conference Board, a private research group, said its index of consumer confidence for the US rose to 90.9 in July from 86.4 in June. July’s reading is the highest since October 2007, just before the last recession, and easily beating forecasts of a reading of 85.4 in a survey of economists surveyed by Bloomberg News.

This is the latest evidence that the economy may be picking up after a sluggish first half of the year.

This article was compiled by Bank of Valletta for general information purposes only.