The UK economic system contracted by 0.5 per cent in July, in line with newly launched information simply revealed by the Workplace for Nationwide Statistics (ONS).
This got here after 0.5 per cent progress in June, the ONS stated, and is worse than anticipated. Economists polled by Reuters had forecast a smaller contraction of 0.2 per cent.
However well being minister Maria Caulfield this morning has defended the federal government’s dealing with of the economic system, tellingly Sky Information the info reveals the federal government’s “message on inflation is true” as a result of until it’s diminished, there might be continued financial pressures.
She additionally cited the affect of strike motion on progress figures, a truth which “reinforces our message that we wish to get the strike motion resolved”.
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“Sure, we’re disillusioned with immediately’s figures – there [are] causes for that”, she stated.
Ms Caulfield added there’s “no indication” that the UK is heading for a recession.
The economic system would want to contract in two consecutive quarters for the UK to be in a recession.
Shadow chancellor Rachel Reeves stated in a press release immediately the economic system “stays hostage to the Conservatives’ low progress entice that’s leaving working folks worse off”.
She added: “After 13 years of instability, the Conservatives have left the British economic system weaker and households having to deal with greater taxes, greater mortgages and better meals and power payments.
“Labour’s plan for the economic system is about boosting progress so we are able to enhance wages, carry down payments and make working folks in all components of the nation higher off.”
The ONS’ director of financial statistics Darren Morgan stated this morning: “Our preliminary estimate for July reveals that GDP fell; nonetheless, the broader image seems extra constructive, with the economic system rising throughout the companies, manufacturing and development sectors within the final three months.
“In July, industrial motion by healthcare staff and academics negatively impacted companies, and it was a weaker month for development and retail because of the poor climate.
“Manufacturing additionally fell again following its rebound from the impact of Could’s additional financial institution vacation.
“A busy schedule of sporting occasions and elevated theme park visits supplied a slight enhance.”
In response to the figures, Chancellor Jeremy Hunt stated: “Solely by halving inflation can we ship the sustainable progress and pay rises that the nation wants.”
He added that there are “many causes to be assured in regards to the future”, citing the UK being “among the many quickest within the G7 to recuperate from the pandemic”, and the IMF’s evaluation that the UK economic system will develop “sooner than Germany, France, and Italy in the long run”.
