Despite the slowdown, there are signs of improvement, including a rise in the household saving ratio and GDP per head.

The Bank of England predicts further slowdown in the third quarter but anticipates growth will pick up later in the year, fuelled by interest rate cuts and lower inflation.

Matt Swannell, chief economic advisor to the EY ITEM Club, said: “Today the Office for National Statistics (ONS) released updated UK GDP data. GDP growth in Q2 2024 was still above trend, but was revised down to 0.5% from 0.6%.

“There was little change to headline GDP across the remainder of 2023 and 2024. As had been previously trailed by the ONS, there was a larger change to GDP growth in 2022, which was revised up by 0.5ppts to 4.8%. 

Mr Swannell continued: “The updated data changes the story slightly around the UK’s recent economic performance, but it doesn’t have significant implications for near-term outlook.

“It’s now the case that the post-pandemic recovery was a little stronger than previously thought. In Q2 2024, GDP was estimated to be 3.3ppts above its 2019 level, up from 2.7ppts. Looking at the more recent data, we continue to think that following a burst of well above-trend growth in H1 2024, the economy will slow towards trend over H2.

“Digging into the detail, the most eye-catching revisions were to the household saving ratio. Though it is still reported to have picked up sharply in recent quarters, the saving ratio has been revised much lower for 2022-2023, to the extent that we now know that it was below its 2010-2019 average for 18 months. So while there appears to be scope for dis-saving to support the consumer recovery over the next couple of years, that firepower now looks smaller than previously thought.”