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Restaurants, bars and festivals helped economy pick up in August after rules eased

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UK economic growth picked up in August as bars, restaurants and festivals benefited from a first full month without COVID restrictions in England, official figures show.

Gross domestic product (GDP) increased by 0.4% month-on-month, according to the Office for National Statistics (ONS) – slightly below experts’ average forecast of 0.5% growth.

However the report also pointed to a setback for the previous month, with July GDP, initially estimated to have shown a small 0.1% increase, now believed to have seen a 0.1% decline.

That was after revisions to data from sectors including car manufacturing – an industry which has been badly hit by the global shortage of semiconductor chips.

Overall it meant that GDP in August was 0.8% below the pre-pandemic levels of February 2020, the ONS said.

Darren Morgan, ONS director of economic statistics, said: “The economy picked up in August as bars, restaurants and festivals benefited from the first full month without COVID-19 restrictions in England.

“This was offset by falls in health activity with fewer people visiting GPs and less testing and tracing.

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“However, later and slightly weaker data from a number of industries now mean we estimate the economy fell a little overall in July.”

Chancellor Rishi Sunak responded by pointing to recent data showing growth in payroll jobs numbers and forecasts that UK growth will outpace other G7 countries.