UK economy probably picked up speed in Q1, says CBI employer group

[LONDON] British economic growth probably picked up pace in the first quarter of 2015, a business lobby group said on Tuesday, giving an upbeat assessment of the recovery as the country heads for a national election next month.

The Confederation of British Industry (CBI) said its monthly growth indicator suggested growth accelerated to a quarterly rate of 0.7 per cent in the first three months of the year.

Data published last week showed Britain's economy grew by 0.6 per cent in the October-December period. But a fall in services output in January prompted several economists to say growth in the first quarter of 2015 could be a lot slower.

A first official estimate of how Britain's economic fared in the initial three months of this year is due to be released on April 28, the week before May 7's national election.

A slowdown could make it harder for Prime Minister David Cameron to argue that the recovery from the financial crisis is only safe in the hands of his Conservative Party.

The CBI said on Tuesday that its growth indicator stood at +18 in the January-March period, down from +19 in the three months to February.

Expectations for business growth over the next three months picked up in March but remained below their level of a year ago, the CBI said.

Katja Hall, the CBI's deputy director general, said the plunge in global oil prices would help growth in the coming months, but there was a risk of fallout for British companies from Greece's attempts to remain in the euro zone.

"Many businesses will also have to contend with a stronger pound weighing down on already-weak export growth," she added.

The CBI growth indicator is an aggregate index based on surveys conducted by the employers group and covers around three quarters of the private-sector economy, according to the CBI.

REUTERS