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LONDON — The U.Ok. economic system continued to flatline in July on a month-on-month foundation, flash figures revealed from the Workplace for Nationwide Statistics confirmed Wednesday.
Gross home product (GDP) got here in under the expectations of economists polled by Reuters, who had forecast progress of 0.2%.
The nation additionally logged no GDP progress in June.
Britain’s dominant companies sector confirmed slight progress of 0.1% within the month to July, whereas manufacturing and development output fell by 0.8% and 0.4%, respectively.
Britain’s financial progress was up 0.5% within the three month to July, barely under economist expectations and the 0.6% recorded within the second quarter ending in June.
“The economic system recorded no progress for the second month working, although long term power within the companies sector meant there was progress over the past three months as an entire,” Liz McKeown, director of financial statistics on the ONS, mentioned.
The U.Ok. economic system had recorded modest however regular growth virtually each month to this point this 12 months, having emerged from a shallow recession at first of the 12 months.
The studying is the primary underneath Prime Minister Keir Starmer’s new Labour authorities, which was elected on July 4.
Finance Minister Rachel Reeves mentioned the print left her “underneath no phantasm” of the challenges confronted by the U.Ok. economic system.
“I can be sincere with the British people who change is not going to occur in a single day. Two quarters of constructive financial progress doesn’t make up for fourteen years of stagnation,” Reeves mentioned.
It comes forward of the forthcoming Oct. 30 Autumn Assertion, when Reeves will reveal her annual price range. She has already warned can be painful after she mentioned she inherited a £22 billion ($29 billion) gap within the public funds from the previous Conservative authorities. He predecessor Jeremy Hunt has denied the claims, describing the alleged black gap as “fiction.”
Lindsay James, funding strategist at Quilter Buyers, mentioned the prospect of tax raises may add additional warning to client spending over the approaching months.
“Tax rises have been flagged forward of the Autumn Price range, and customers and companies might really feel slightly extra cautious heading into the winter months as they await particulars from the Treasury,” she mentioned.
However she added that additional motion in rates of interest anticipated from the Financial institution of England may assist ease wider progress pressures. The central financial institution is ready to satisfy subsequent week for its newest coverage resolution, after slicing charges for the primary time in 4 years final month.
“This month could be a blip nevertheless, given latest constructive noises which were sounded in regards to the state of the broader economic system, particularly as price cuts will proceed to be delivered over the approaching 12 months,” James famous.