1047 GMT - AI supported the U.K. in July's surprisingly strong 0.4% GDP growth, Morgan Stanley's Bruna Skarica says in a note. The ICT sector is producing 8.1% more value-added compared with last year, despite hiring being down on the same period of 2025, she says "We have been arguing for a while that the U.K. economy is being supported by the global capex/AI cycle," she says. Bank of England Gov. Bailey acknowledged this week that there were signs of an improvement in productivity growth, but said this wasn't related to AI. "We disagree, and see today's print as further evidence that tech adoption is the primary driver of the now very clear cyclical rise in output per worker across the private sector," Skarica says.
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