The estimated rate of contraction of the UK economy in the three months from April to June has been reduced by the UK government’s Office for National Statistics (ONS), which also says the automotive sector is playing a key role in supporting economic activity.

GDP has been revised to a fall of 0.7% from 0.8% compared with the previous quarter. The year-on-year decline has been revised to 5.5% from 5.6%.

The ONS said the revision was due to better-than-expected output from the manufacturing, energy, wholesaling and motor vehicle sectors.

David Raistrick, UK Manufacturing Leader at consultants Deloitte commented: “Today’s report from the Office for National Statistics that the economy has shrunk less than expected demonstrates how the upturn in the manufacturing and automotive sectors is contributing to a recovery in the UK.

“While both the manufacturing and automotive sectors still face very challenging environments, recent reports suggest that the industries may have passed the worst and are on the slow road to recovery.

“Recent manufacturing production figures were the most positive they have been in over past 12 months and new car production and registration figures have surged due to the scrappage scheme.

“While the UK is still behind other European countries such as France and Germany in exiting the recession, it is hoped that we will be next to follow. Evidence from other strong manufacturing countries such as Germany and Japan demonstrate the critical importance of industry to economic recovery.  Further stabilisation in the UK manufacturing and automotive sectors will play an important role in our recovery.”