United Kingdom economy shows marginal growth for 2 consecutive month
A recession was declared in February after data showed two quarters of economic contraction. If the economy expands for three months, the UK will be officially out of recession.
The UK economy has grown slightly for the second month in a row, official figures show.
Gross domestic product (GDP) grew just 0.1% in February, the Office for National Statistics (ONS) said.
It’s another signal that the UK economy is working its way out of recession.
Growth of 0.3% was recorded last month, and that figure has been revised upwards from a previous estimate of 0.2%.
A recession was declared in February after data showed two quarters of economic contraction.
If the economy expands for three months, the UK will be officially out of recession.
February growth came thanks to expansion in manufacturing, especially in the car industry.
Overall growth was historically small, as sectors such as construction were hampered by rain.
It’s not the first time that the weather has dampened economic growth.
As the UK experienced a record 18 months of rainfall, retail sales and building activity have been affected, weighing on productivity across the country.
But when the past three months are taken as a whole, the economy grew for the first time since last summer, the ONS said.
It’s good news for the Conservatives after Prime Minister Rishi Sunak made growing the economy one of his five priorities.
So far, only one has been achieved: halving inflation.
Responding to the data, Chancellor Jeremy Hunt said: “These figures are a welcome sign that the economy is turning a corner, and we can build on this progress if we stick to our plan.
“Last week, our cuts to national insurance for 29 million working people came into effect across Britain as part of our plan to reward work and grow the economy.”
But Labor’s shadow chancellor, Rachel Reeves, warned: “After 14 years of Conservative economic failure, Britain is worse off with low growth and high taxes. The Conservatives cannot fix the economy because they are the reason it is broken.”
At the start of 2023, Prime Minister Rishi Sunak made five promises to the British public that he said would give them “peace of mind”.
Since then, he and his ministers have rarely missed an opportunity to list them. In case you haven’t heard, he promised to:
• Halve inflation
• Grow the economy
• Reduce debt
• Cut NHS waiting lists and times
• Stop the boats
He then invited people to hold him to his word.
We have built this tracker to let you keep an eye on his progress.
How we are measuring progress?
Pledge 1: Halve inflation
When Mr. Sunak promised to halve inflation, the headline figure of Consumer Price Inflation (CPI) in the fourth quarter of 2022 was 10.7%. This suggests it would need to fall to 5.35% by the end of this year for the pledge to be met.
CPI is the rate at which prices are thought to be rising.
Inflation figures for the fourth quarter of 2023 are expected to be published on January 17, 2024.
Pledge 2: Grow the economy
Economic growth is assessed by the UK’s Gross Domestic Product, or GDP, which measures the activity of all companies, governments, and individuals in the country.
If GDP is rising, then the economy is growing. GDP for the fourth quarter of 2023 is expected to be published on June 13, 2024.
Pledge 3: Reduce debt
The prime minister said: “we will make sure our national debt is falling so that we can secure the future of public services.”
Net debt is measured as a proportion of GDP because it is considered to be falling if it is growing more slowly than the economy.
The next debt forecasts will be published alongside the 2023 Autumn Statement.
Pledge 4: Cut NHS waiting lists and times
This is the only promise that refers solely to England because the devolved governments manage health in Scotland, Wales and Northern Ireland.
The prime minister said he would cut the number of people waiting for treatment and the time it takes for them to get it.
Waiting list figures are published with a two-month delay on the second Thursday of each month. So, we should know in mid-February 2024.
Pledge 5: Stop the boats
Mr. Sunak said he would “pass new laws to stop small boats” so that people who come to the UK illegally can be “detained and swiftly removed.”.
The government finally passed its Illegal Migration Bill on 17 July.
Figures on the number of people arriving in the UK on small boats are collected daily and published with a one-day time lag.