UK economy expands by 0.5% in February, more than expected

The U.K. economy grew by a higher-than-expected 0.5% month-on-month in February amid a jump in the services output, official data showed on Friday.

Analysts had projected a monthly gross domestic product hike of 0.1% in February, according to LSEG data.

The Office for National Statistics, which published the provisional figures, said a 0.3% expansion in the services sector had driven the surprise jump in growth. In January, services had recorded a 0.1% monthly rise.

Production output saw a substantial recovery in February, notching 1.5% month-on-month growth compared to the monthly contraction of 0.5% seen in January. Construction output also staged a recovery in February, adding 0.4% on the month after falling 0.3% in January.

The British pound jumped against the dollar after the data release, rising 0.2% against the greenback to trade at $1.2988 by 7:18 a.m. in London.

In January, an early estimate showed the U.K. economy unexpectedly shrank by 0.1% on a monthly basis. That figure was later revised upward to show that economic growth was flat in January.

The U.K. economy has struggled to gain momentum over the past year. ONS data showed earlier this year that Britain's GDP expanded by 0.1% in the fourth quarter of last year, after flatlining in the three months prior.

Friday's figures are released as the U.K. braces for the economic impact of new 10% tariffs on its exports to the United States.

This breaking news story is being updated.