Over the three months leading to January, GDP grew by 0.5%, contrasting with the stagnant growth of the previous quarter.

The services sector drove January’s growth, expanding by 0.5%, while the production and construction sectors contracted by 1.0% and 0.2% respectively.

Despite the positive GDP figures, economists warn of ongoing financial pressures. Kevin Brown, savings specialist at Scottish Friendly, highlighted that inflation, rising council tax, and increased utility bills are likely to strain household budgets.

Mr Brown said: “The latest set of GDP figures reveal Scotland’s economy expanded by 0.3% in January. This was ahead of the rest of the UK, with the country’s services sector continuing to drive growth. It continues the more encouraging growth pattern seen in December, after a lacklustre Autumn.

“While this is good news, Scots are unlikely to feel much better off. Inflation is still running at just under 3%, and a series of price increases are likely to dent household finances further. In particular, council tax rises are expected to be double or even treble the rate of inflation, while water and energy bills are also set to rise in the coming months.”

He continued: “Scottish businesses are also facing higher costs as the Employers’ National Insurance rise comes into effect. This may dent hiring and could contribute to further inflationary pressures. It’s likely to be an uncomfortable few months ahead for businesses and households.

“The best defence against tougher times is a strong financial cushion. Scots need to get their finances ship-shape in anticipation of a difficult few months. That means moving any savings languishing in low-paying savings accounts, or looking at stock market options that could provide a greater potential of beating inflation.”

Deputy First Minister Kate Forbes said: “In the three months to January, GDP is now estimated to have grown by 0.5% compared to the previous three month period. This is a strong start to the year for the Scottish economy, particularly in the context of global economic uncertainty.

“Many of the levers needed to deal with our economy lie with the UK government. In particular, the UK government must provide swift clarity on how today’s Spring Statement, including its profoundly concerning planned cuts to welfare, will impact Scotland’s economy and Budget.

“I am focused on delivering economic growth with the limited powers the Scottish Government holds, and creating an investor-friendly environment. Already this year we have seen significant investments in a subsea cable manufacturer at Hunterston and new port infrastructure from Scapa to Montrose, and we are laser-focused on unlocking new private investment in the country’s rapidly growing offshore wind industry.”