Construction lays foundation for fastest growth quarter since 2010

The UK’s builders and manufacturers could hand Chancellor George Osborne yet more good news this week with figures poised to show the quickest advance for the economy since the Coalition took office.

Experts believe the Office for National Statistics’ latest estimate of the economy between April and June – which has already been revised higher once to 0.7 per cent – could be lifted yet again to 0.8 per cent. This would mark the fastest growth since the second quarter of 2010.

The looming upgrade comes after construction, which accounts for around 6 per cent of overall gross domestic product, expanded by a much-quicker-than-expected 1.9 per cent over the quarter. Industrial production was also revised higher.

IHS Global Insight’s Howard Archer said: “It is not inconceivable that growth is revised higher as these revisions together would add nearly half a percentage point to growth.”

The figures will also give more detail on the state of household balance sheets after the household savings ratio hit a four year low of 4.2 per cent in the first quarter. Household after-tax incomes also fell by 1.7 per cent.

Investec chief economist Philip Shaw said: “This fall in income was due to a delay in the payment of some high incomes, in order to benefit from the 5p cut in the highest rate of income tax to 45p. So we would expect a significant recovery in incomes and a rebound in the saving ratio.”