Recession fears loom as UK GDP falls 0.2% – POLITICO
Britain’s GDP fell 0.2% from July to September this year, according to estimates released by the Office for National Statistics on Friday.
If the economy contracts for a second consecutive quarter in the last three months of this year, the UK will have officially entered recession. Last week the Bank of England warned that the UK was at risk of entering the longest recession in a century, which will last until the middle of 2024.
“I have no illusions that there is a difficult road ahead, which will require extremely difficult decisions to restore confidence and economic stability,” British Chancellor Jeremy Hunt said in a statement on Friday morning. « To achieve long-term sustainable growth, we must control inflation, balance the books and reduce debt. There is no other way. »
Hunt is due to present his fiscal plans in a budget statement on Nov. 17, with tax hikes and spending cuts widely anticipated.
The ONS said monthly estimates showed GDP fell 0.6% in September, but pointed out that the month’s figures were negatively affected by an additional bank holiday held for Queen Elizabeth II’s state funeral .
Real household spending for the third quarter fell by 0.5%, according to ONS estimates.
Rachel Reeves, the shadow chancellor of the opposition Labor Party, said: « Britain’s unique exposure to economic shocks is due to a Tory-led decade of low growth, low productivity, under- investment and growing inequality. »
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