Hopes that Britain is heading out of recession were fuelled by a raft of positive new economic data today, although doubts remain over how quickly the country will return to growth.
Analysts have been encouraged by new industry data, signs of life in the job and property markets and a rebounding stock market - and one respected think tank said the recession actually ended in May.
However, most analysts expect unemployment to continue rising and say even when growth resumes, it will be some time before Britain returns to the kind of economic activity seen before the global financial crisis began last year.
Today saw the release of positive figures on trade, jobs and consumer confidence, and international ratings agency Moody's announced that Britain was likely to maintain its top AAA credit rating for the time being.
Combined with a recent stock market rally and figures yesterday which showed an increase in manufacturing output, they reinforce the expectation that the recession will end in the third quarter of this year.
Estate agents this week also reported a surge in interest from potential buyers, and a new report from Nationwide banking group revealed that while consumers remain cautious, confidence is on the up.
France, Germany and Japan have officially exited recession but Britain and the US have yet to return to growth after the biggest global downturn since the 1930s.
Official data that would prove Britain was out of recession is not due until the end of October. Yet the National Institute of Economic and Social Research (NIESR) said yesterday that it estimates national output rose by 0.2% in the three months ending in August - suggestion the recession is already over.
'This is the first time our GDP indicator has been higher over a three-month average since May of 2008 and reinforces our view that the recession ended in May of this year,' the think tank said.
However, it warned of a period of stagnation to come. 'The end of the recession should not be confused with a return to normal economic conditions,' it stated.
Unemployment remains a major concern, with the number of people unemployed in Britain hitting a 14-year-high in the three months to June, reaching 2.43 million.
Analysts expect it to continue climbing when the next batch of figures are published next week.
Finance ministers from the G20 meeting in London last weekend cited concerns about jobs as one reason why they remain cautious about economic recovery.
