- 57
- UK's economy emerges from the slump
-
Britain’s economy rebounded in January, official data showed Friday after it narrowly avoided recession in the fourth quarter despite soaring inflation.
Gross domestic product grew 0.3 percent, the Office for National Statistics said in a statement, as the services sector offset poor performance by construction and manufacturing.
GDP had dropped 0.5 percent in December amid widespread strikes as many workers protested over pay that has failed to keep pace with runaway inflation.
“The economy partially bounced back from the large fall seen in December,” said ONS director of economic statistics Darren Morgan.
According to ONS director of economic statistics Darren Morgan, the economy partly recovered from the severe decline observed in December.
“The main drivers of January’s growth were the return of children to classrooms, following unusually high absences in the run-up to Christmas, the Premier League (football) clubs returned to a full schedule after the end of the World Cup and private health providers also had a strong month.
“Postal services also partially recovered from the effects of December’s strikes.”
Although Britain avoided a recession last year, the Bank of England predicts that it will continue this year.
Despite a recent easing, the UK's decades-high inflation has been a drag on output, which has also been hurt by increasing BoE interest rates.
After contracting by 0.3% over the previous three months, the economy experienced zero development in the last three months of 2017.
By definition, a technical recession is when the economy contracts for two consecutive quarters.
The economy experienced flat development in the three months leading up to January, the ONS cautioned on Friday.
Additionally, the GDP in January was unchanged from the same month a year ago.
“This tallies with the idea that the UK economy is going to shrink overall this year, even if a technical recession is avoided,” said Hargreaves Lansdown analyst Sophie Lund-Yates.
“The takeaway for businesses is unfortunately that things are going to remain very challenging, with stagnation a likely scenario for some time.”
Meanwhile, it was believed that monthly GDP was O.2% below its pre-pandemic level.
One week prior to British Finance Minister Jeremy Hunt's budget, Friday's data was released.
In reaction to Friday's figures, Hunt said, "The UK economy has proven more resilient than many anticipated in the face of severe global challenges, but there is a long way to go.
Pristine Network
- 2023-03-10 15:42:53
