Business group the CBI has said the UK is starting to see "the right kind of growth" as it lifted it predictions for expansion in the economy this year from 2.4% to 2.6%.
It said business investment would make a positive contribution this year, rising at the fastest rates since 2007, while increasing exports would help net trade play a small role in supporting the recovery.
The upgraded forecast for 2014 reflects a stronger than expected performance at the end of last year. However, the CBI has downgraded growth expectations for next year from 2.6% to 2.5%.
The CBI expects that unemployment reached the Bank of England's 7% "forward guidance" threshold in the final quarter of last year - for which labour market figures have not yet been published.
The guidance pledges that policy makers will not begin to consider a rise in interest rates until the threshold has been reached.
But the CBI predicts that despite having fallen to this level, continued low inflation and spare capacity in the economy mean that interest rates will not go up until the third quarter of 2015.