The National Institute of Economic and Social Research said in a report today that the UK economy is expected to grow at a faster rate than earlier expected.

The Institute said that the economy will grow faster than earlier believed as rising house prices boost consumer spending.  The country's Gross domestic product is expected to rise 2.5 percent this year, which is more than 2 per cent predicted by the institute in November.  The unemployment rate will reach 7 per cent and this might convince the Bank of England to consider an interest-rate increase.

Niesr said, "We expect consumer spending to remain the key driver of the recovery in 2014 and 2015, supported by continued buoyancy in the housing market.  The U. K.'s economic recovery has become entrenched."

The UK's housing prices rose1.1 percent in January as customers increased demand for the housing unit.  Niesr said there's "considerable uncertainty" over the impact on the housing market of the government's support schemes.  The growth has helped boost labor market earlier than expected by the central bank.