Britain’s Economy Shows No Growth in Third Quarter
The British economy failed to show any growth in the third quarter, according to figures released by the Office for National Statistics on Friday. This comes as a disappointment to economists, who had predicted a fall in gross domestic product (GDP) of 0.1%, potentially indicating the start of a recession. However, official data revealed that the figure remained at 0%.
In September, the economy did manage to grow by 0.2% from the previous month, with August’s growth being revised down from 0.2% to 0.1%. The Reuters poll had initially predicted no change in GDP for September.
The Office for National Statistics reported that output in Britain’s services sector, which makes up a significant portion of the economy, fell by 0.1% during the quarter. Industrial production, on the other hand, remained relatively stagnant, while construction saw a slight increase of 0.1%.
The Bank of England had previously forecasted zero growth for the British economy next year. In response to the latest data, the central bank is expected to maintain its benchmark interest rates at a 15-year high as it continues to tackle an inflation rate that is more than three times its target of 2%.
Finance Minister Jeremy Hunt commented on the figures, stating that high inflation remains the biggest obstacle to growth. He intends to announce plans to stimulate investment and employment in his budget update statement on November 22.
Despite the lack of growth in the third quarter, economists remain hopeful that the economy will pick up in the coming months. The uncertain outcome of Brexit negotiations and the potential impact on trade, however, continue to cast a shadow of uncertainty over the future of the UK economy.
Overall, the latest figures highlight the challenges facing the British economy and the need for measures to stimulate growth and address inflation. The government’s budget update later this month will likely shed further light on its plans to tackle these issues and provide a clearer outlook for the future.
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