UK GDP increased by a surprise 1.1% in the second quarter, almost double the consensus estimate.
The figure represents the largest quarterly increase in four years and is 1.6% up on the second quarter of 2009, accoding to the ONS.
The increase is output was largely due to improvements in the business services, finance, and construction industries, which contributed positively to growth. However, this was partially offset by weakness in the transport, storage and communications sectors.
Service industry output grew 0.9%, while production industry output grew 1%.
But economists warned against over-optimism, pointing to weakening business surveys, among other factors. Jonathan Loynes, the chief European economist at Capital Economics, says there are two reasons not to get too excited.
"First, while strong by any ordinary standards, Q2's gain in GDP is less impressive in the light of the sharp falls seen during the recession. There were two quarters when GDP fell by more than 2% and activity is still over 4% below its Q1 2008 level," he says.
"Second, with recent business surveys weakening and the fiscal squeeze looming, Q2 looks very likely to be the peak in terms of the pace of growth - expect a much weaker second half."
However, Schroders' European economist Azad Zangana described the figures as "a tremendous rebound" from the disappointing 0.3% growth seen in the first quarter, and says it could be enough to stave off a double-dip recession.
"The City had expected an improvement of 0.6% growth, but the latest estimates are a very positive surprise which should provide a boost to consumer confidence heading into the second half of the year. The UK economy had a poor start to the year with bad weather affecting activity, and the increase in VAT to 17.5% hitting retail sales. It now appears that the economy is bouncing back strongly, with almost every sector making a positive contribution.
"Though the latest growth estimates are very encouraging, we doubt we will see a repeat performance in the second half. While we expect growth to moderate, we also believe that there is now enough momentum built up to avoid a double-dip recession."
Sterling rose 1.03% against the dollar following the release of the data, to a session high of $1.5416. The pound also rose 0.67% versus the euro to €1.1915.
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