Hunt insists plan to bring inflation down is working despite 4 per cent increase
The UK is thought to have slipped into recession at the end of last year, official figures are set to show on Thursday.
The Office for National Statistics (ONS) is expected to reveal that the UK economy contracted for the second quarter in a row in the final three months of the year.
Most economists are forecasting a 0.1 per cent decline in gross domestic product (GDP) between October and December.
This would follow a 0.1 per cent contraction in the previous three months, after a downward revision against the zero growth initially estimated.
A technical recession is defined by two or more quarters in a row of falling GDP.
Experts say that if confirmed, it would be a recession in the “mildest of senses” and is likely to be short-lived, with many preferring to describe the UK’s economy as having stagnated.
But a recession would deal a blow to prime minister Rishi Sunak, who has promised to grow the economy as one of his five priorities.
Inflation surprises experts by holding steady
UK inflation defied expectations to hold steady at 4% in January as lower food prices helped offset increases in energy costs, official figures show. Economists had expected a rise to 4.2%:
Jane Dalton14 February 2024 20:30
Economy is flat at best, says Bank chief
Bank of England governor Andrew Bailey has signalled that a recession, if confirmed, would be likely to be brief, telling a Lords committee on Wednesday the economy was beginning to pick up.
Mr Bailey told the House of Lords Economic Affairs Committee: “In our February Monetary Policy Report, it was in the balance – we didn’t have a recession in the forecast, but it is at best flat, in the view we took.
“It wouldn’t take much to tip it either way, frankly.
“Going forward – and I think this is in some ways more significant – we are now seeing some signs of the beginning of a pick-up in some of the surveys, for instance … we’ve got a modest pick-up this year which continues thereafter.”
Andrew Bailey at the committee
(PA)
Jane Dalton14 February 2024 19:20
Economy thought to have been weak last year
Official figures for the fourth quarter of last year are also expected to show that the economy was weak last year as a whole.
ONS estimates suggest it did not grow at all between April and June, before shrinking between July and September, which has left the UK at risk of recession in the final three months.
(PA Archive)
Jane Dalton14 February 2024 18:37
UK technically in recession last year, statistics set to reveal
Welcome to our live blog on the UK economy.
The UK is believed to have slipped into recession at the end of last year after a weak December for the country’s economy, official figures are set to show.
The Office for National Statistics (ONS) is predicted to reveal that the UK economy contracted for the second quarter in a row in the final three months of 2023.
Most economists are forecasting a 0.1% decline in gross domestic product (GDP) between October and December.
This would follow a 0.1% contraction in the previous three months, after a downward revision against the zero growth initially estimated.
A contraction in the fourth quarter would mean the UK tipped into a technical recession, as defined by two or more quarters in a row of falling GDP.
The Bank of England has held interest rates at 5.25% four times in a row.
(PA Wire)
Jane Dalton14 February 2024 18:26
Robert Johnson is a UK-based business writer specializing in finance and entrepreneurship. With an eye for market trends and a keen interest in the corporate world, he offers readers valuable insights into business developments.
