Breaking News: UK Economy Grew Less Than Thought in Spring
LONDON, June 15, 2023 – The UK’s economy grew less than expected in the spring, new data has revealed, adding to concerns about the nation’s post-Brexit economic prospects.
According to the Office for National Statistics (ONS), the UK’s gross domestic product (GDP) expanded by 0.3% in the first quarter of 2023, missing forecasts of 0.5% growth.
This marks the slowest rate of growth since the 2020 lockdowns and raises questions about the durability of the UK’s recovery from the COVID-19 pandemic.
The ONS attributed the sluggish growth to a decline in the services sector, which accounts for around 80% of the UK’s economy. The sector was hit by a decline in retail sales and a slowdown in consumer spending.
Meanwhile, the manufacturing sector saw a marginal increase in output, partly due to a surge in exports.
The news has sent shockwaves through the financial markets, with sterling falling against the dollar and the yield on UK government bonds dropping.
Experts Weigh In
"We were expecting a bit more oomph from the economy, but it’s clear that the recovery is losing steam," said Jonathan Loynes, chief UK economist at Capital Economics.
"The services sector is being hit hard, and with consumer spending still under pressure, it’s going to be tough for the economy to get back on track."
Key Takeaways
- UK economy grows 0.3% in Q1 2023, missing forecasts of 0.5%
- Services sector declines, while manufacturing output sees marginal increase
- Sterling falls against the dollar, UK government bond yields drop
- Experts warn of tougher times ahead for the economy
Related News and Analysis
- UK inflation rate falls to 1.9% in May, but economists warn of rising costs ahead
- UK manufacturing sector sees decline in output, as recession fears grow
- Experts predict UK interest rates will remain low, despite slowing economy
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UK economy grew less than thought in spring
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