The Confederation of British Industry says growth reached a record high in May, the best reading since it began gathering data in 2003, citing increased confidence, easier access to credit and better global economic conditions as the main reasons for the improvement.
Separately, the British Chambers of Commerce upgraded its growth forecast for 2014 from 2.8% to 3.1%, well above the 2.7% forecast by the Office for Budget Responsibility and which would be the highest rate since pre-crisis 2007.
Latest official figures showed that the UK economy grew by 0.8% in the first three months of 2014 and the CBI’s report suggests it has continued to perform strongly in the second quarter of this year.
Sectors including retail sales, professional and consumer services did well in the three months to May, while manufacturing output continued to grow steadily.
The BCC’s director general, said: “Our forecast confirms that Britain is leading, rather than following, other major economies when it comes to short-term growth, which is great news.”
Some headwinds remain
However, the CBI said there were still risks to the economic outlook in the UK from global developments, including the situation in Ukraine and Russia and the Eurozone situation still far from being resolved and the BCC added that the UK was still overly reliant on consumer spending as a driver of growth.