By Aysu Bicer
LONDON (AA) - The UK economy grew 0.3% month-on-month in January, recovering from a 0.5% contraction in December, according to the Office for National Statistics on Friday.
The market forecast was a 0.1% rise.
The services sector went up 0.5% in January, after decreasing 0.8% in December last year, with the biggest contributions to growth in January coming from education, transport and storage, human health activities, and arts, entertainment and recreation activities.
Analysts said the economy's recovery could be seen as faster than projected given the challenges faced by businesses due to walkouts and the cost-of-living crisis.
The GDP data could give Jeremy Hunt, the Treasury chief, a slight boost before next week's budget, as it shows some positive signs of economic recovery.
However, it remains to be seen how the government's tax and spending policies will impact the economy in the long term.