Millions of Britons will be better off as the economy picks up, says the Government after GDP growth hit 0.7% in the first three months of the year.
Welcoming the figures, Sir Keir Starmer stressed: "The UK now has the fastest growth in the G7.
"We've had four interest rate cuts since July and wages are rising faster than prices.”
City minister Emma Reynolds also emphasised that the growth figure meant the UK economy expanded at a quicker rate than the US, Germany, France, Italy, Canada and Japan, the other members of the G7 group of wealthy nations.
“Obviously we want to see even higher levels of economic growth...this is about ensuring that people are better off across the country,” she told Sky News.
The ONS figures also showed real GDP per person was up 0.5% in the first quarter of 2025, the first time it has risen since Labour won power last July.
Many households, though, are still not feeling better off as the cost-of-living crisis continues to bite.
But Ms Reynolds stressed that wages are increasing faster than prices, interest rate cuts by the Bank of England would lower mortgage bills for some households, and planning reforms would boost growth.
The upbeat GDP figures, which were better than predicted by the City, are a boost to Chancellor Rachel Reeves who has faced heavy criticism for her autumn Budget, particularly the hike in National Insurance contributions for employers.
It may also put the Government on track to achieve its manifesto aim of the UK having the fastest , sustained growth of the G7 group of wealthy nations.
This means it came in ahead of economists’ expectations of 0.6% growth for the quarter.
It was also the highest GDP rate since the first quarter of 2024, when the economy jumped by 0.9%.
Liz McKeown, ONS director of economic statistics, said: “The economy grew strongly in the first quarter of the year, largely driven by services, though production also grew significantly, after a period of decline.
“Growth in services was broad based, with wholesale, retail and computer programming all having a strong quarter as did car leasing and advertising.
“These were only slightly offset by falls in education, telecoms and legal services.”
The pound briefly extended gains against the US dollar on Thursday after the GDP data, rising to $1.328.
But some economists do not expect the growth surge to continue.
“The bumper 0.7% q/q rise in GDP in Q1 is unlikely to be repeated as a lot of it was due to activity being brought forward ahead of US tariffs and the rise in domestic businesses taxes,” said Paul Dales, chief UK economist at Capital Economics.
“This might be as good as it gets for the year.”
Shadow chancellor Sir Mel Stride said both the Office for Budget Responsibility and the International Monetary Fund had downgraded short-term growth forecasts and hit out at the hike in employers’ national insurance, which he branded a “jobs tax”.
“Labour inherited the fastest-growing economy in the G7, but their decisions have put that progress at risk,” he said.
