The British economy shrank in the three months to June.
LONDON, England (AP) — The economy of the United Kingdom shrank in the three months to June, according to figures released Friday — a smaller-than-expected contraction that added to concerns about the rocky months ahead.
According to the Office for National Statistics, the UK’s GDP fell by 0.1% between April and June, compared to 0.8% growth in the previous quarter. GDP fell by 0.6% in June, and May growth estimates were revised downward from 0.5% to 0.4%.
According to the statistics office, the biggest contributor to the drop was the government’s reduction in coronavirus testing, contact tracing, and vaccination programs.
The British economy shrank in the three months to June.
LONDON, England (AP) — The economy of the United Kingdom shrank in the three months to June, according to figures released Friday — a smaller-than-expected contraction that added to concerns about the rocky months ahead.
According to the Office for National Statistics, the UK’s GDP fell by 0.1% between April and June, compared to 0.8% growth in the previous quarter. GDP fell by 0.6% in June, and May growth estimates were revised downward from 0.5% to 0.4%.
According to the statistics office, the biggest contributor to the drop was the government’s reduction in coronavirus testing, contact tracing, and vaccination programs.
“Many retailers also had a difficult quarter,” said Darren Morgan, ONS director of economic statistics. “These were partially offset by growth in hotels, bars, hairdressers, and outdoor events across the quarter,” owing in part to Queen Elizabeth II’s Platinum Jubilee celebrations in June.
According to analysts, the decline does not necessarily indicate the start of a recession, which is commonly defined as two-quarters of economic contraction. The Bank of England, on the other hand, predicts that the United Kingdom will enter a recession later this year as the cost-of-living crisis worsens and inflation rises above the current 9.4%.
The average household fuel bill in the United Kingdom has increased by more than 50% this year as the conflict in Ukraine reduces global oil and natural gas supplies, and another increase is expected in Octoberprogramstwo-quarters when the average bill is expected to reach 3,500 pounds ($4,300) per year.
“The second-quarter decline in UK GDP was largely due to noise,” said James Smith, developed markets economist at ING Economics. “However, the risk of a recession is rapidly increasing, with gas futures hitting new highs for next winter and our latest estimates indicating that the household energy price cap could approach 5,000 pounds in the second quarter of next year.” Much now depends on the autumn fiscal policy announcements.”
Anti-poverty activists, consumer groups, and opposition politicians are putting pressure on Prime Minister Boris Johnson’s Conservative government to assist people in dealing with rising bills. However, Johnson is in his final weeks as prime minister and has stated that “significant fiscal decisions” must be delegated to his successor, who will take office in September.
Anti-poverty activists, consumer groups, and opposition politicians are putting pressure on Prime Minister Boris Johnson’s Conservative government to assist people in dealing with rising bills. However, Johnson is in his final weeks as prime minister and has stated that “significant fiscal decisions” must be delegated to his successor, who will take office in September.
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