Recovery signs as GDP is expected to double and household sentiment hits highest level in over four years

By HUGO DUNCAN FOR THE DAILY MAIL

Updated: 07:47 EST, 22 July 2013

Britain has clocked up its first back-to-back quarter of economic growth for two years, official figures will show this week.

Gross domestic product is widely expected to have increased by 0.6 per cent between April and June – double the 0.3 per cent rise in the first quarter.

That is the fastest rate of growth since the Olympics gave the economy a boost last summer and the first consecutive quarters of expansion since mid-2011.

Household sentiment: Families are more confident about their finances than they have been at any time over the past four-and-a-half years, according to Markit

The figures, which will be published by the Office for National Statistics on Thursday, will be welcomed by George Osborne who is hopeful the recovery is finally under way.

They will also give new Bank of England governor Mark Carney food for thought as he seeks to get the economy up to what he describes as ‘escape velocity’.

The Canadian will next month outline his plans to use ‘forward guidance’ to convince businesses and households that interest rates will stay low for some time to come.

Howard Archer, chief UK economist at IHS Global Insight, said: ‘We believe it is very possible that growth could have been even stronger than 0.6pc quarter-on-quarter in the second quarter. The UK economy really is moving to a firmer footing.’

Plans: New Bank of England governor Mark Carney seeks to get the economy up to what he describes as 'escape velocity'

But output is still more than 3 per cent below its pre-recession peak and the turmoil in the eurozone as well as high inflation at home pose serious risks to the outlook.

The International Monetary Fund last week warned that the recovery remained ‘slow and fragile’.

A report by research group Markit today shows households are more confident about their finances than they have been at any time over the past four-and-a-half years.

Tim Moore, senior economist at Markit, said: ‘The latest consumer sentiment survey shows that it’s not just the weather that has taken a turn for the better in July, as diminishing job insecurities and rising workplace activity helped lift the household finance barometer to its highest mark since the survey began four-and-a-half years ago.’

Ian Stewart, chief economist at Deloitte, said: ‘The UK consumer is past the worst and sentiment is gradually improving. UK business is beginning to find its confidence.’

But he added: ‘For all the positive news about the economy, times remain tough on the High Street and the consumer mood is cautious. ‘Consumers have become used to weak income growth in the last five years.

‘Given the many false dawns since the start of the global financial crisis and the continuing pressure on incomes, consumer spending is unlikely to return to pre-crisis rates of growth for a long time.’