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Gross domestic product (GDP) increased by 0.2% in August, according to data from the Office for National Statistics (ONS)

The services sector was the main contributor to the growth rising by 0.4% in August, but this was partially offset by falls in the construction and manufacturing sectors.

The ONS also revised GDP in July, which was already a worse-than-expected fall of 0.5%, down further to 0.6%.

Mike Randall, CEO of Simply Asset Finance commented, “The UK is continuing its road to recovery as positive GDP growth shows signs that confidence is returning to the market.

“In fact, Lloyds Bank's latest Business Barometer observes that business confidence has remained above 22-year average, while we continue to observe our customers investing in new equipment, staff and resources to capitalise on the year ahead. In September alone, we saw positive year-on-year growth for our lending services, and only expect this to grow in Q4 this year.”

“As the economy recovers, it’s likely that SMEs will look to seize more opportunities to fuel their innovation. Lenders should actively engage in conversations with businesses to understand their ambitions, while providing them with tailored financing solutions to help them on the path to growth."

George Lagarias, Chief Economist at Mazars said: “UK growth remains stubbornly above the recession line. With unemployment rising and high interest rates reducing disposable income, most economists expected that the UK would be contracting by now. This is simply not happening.

“Make no mistake. The economic environment remains challenging, even more so as energy prices are on the rise again. However, persistent UK growth at this stage suggests that any further slowdown, in line with the global economy, may not necessarily lead to anything more than a shallow recession.

“If growth persists, we would also expect interest rates to remain higher for longer.”

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