Britain’s financial system grew on the slowest tempo in a 12 months throughout the first quarter as retailers and producers have been damage by provide disruptions and better costs, elevating issues that the nation could also be headed for a recession.
Gross home product, the broadest measure of financial exercise, rose 0.8% within the interval, slowing from 1.3% within the earlier quarter, the Office for National Statistics stated Thursday. Monthly estimates point out GDP shrank by 0.1% in March.
The figures “suggest the economy had less momentum than we thought even before the full hit from the cost of living crisis has been felt,” stated Paul Dales, chief U.Ok. economist at Capital Economics. “The risk of recession has just risen.” Growth is slowing as producers and retailers battle to beat provide bottlenecks following the COVID-19 pandemic and the conflict in Ukraine fuels rising meals and power costs. Retail gross sales figures present British shoppers are already lowering spending as economists forecast the U.Ok. will see the largest drop in residing requirements in additional than six many years this 12 months.
Thursday’s figures underscore how the U.Ok.’s restoration from the pandemic has slowed over the previous 12 months. Four straight quarters of financial progress imply GDP is now again above pre-pandemic ranges for the primary time, the ONS stated.
But the first-quarter progress fee was the slowest for the reason that first quarter of 2021, when the financial system expanded 5.6%.
Treasury chief Rishi Sunak blamed the slowdown on Russia’s invasion of Ukraine and “other global challenges,” noting that Britain’s financial system continues to be rising quicker than these of the U.S., Germany and Italy.
“The U.K. economy recovered quickly from the worst of the pandemic and our growth in the first few months of the year was strong … but I know these are still anxious times,” he stated in an announcement.
Source: www.financialexpress.com”