Sunday, 4 June 2023

Official data: British economy escaped recession by achieving ‎growth in Q4‎

Official data showed today, Friday, that the British economy recorded growth in the fourth quarter of last year, thanks to travel activities and state support for energy costs, which helped the country avoid slipping into recession.

According to “Reuters”, economic output increased by 0.1 percent from the previous quarter, after it contracted by 0.1 percent in the third quarter, a contraction rate that was less than expected.

The National Bureau of Statistics had previously said that there were no signs of economic growth in the fourth quarter. Recording a contraction for two consecutive quarters would have meant the country entering a recession

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Despite the improvement shown by the data, British economic output remained at 0.6 percent below the levels of late 2019, making Britain the only country among the Group of Seven major industrialized countries whose economy has not yet recovered from the repercussions of the Covid-19 pandemic.

The data also showed that the services sector, which dominates the British economy, rose by 0.1 percent, supported by a jump of about 11 percent in the activities of travel agents.

Manufacturing activities grew by 0.5 percent, and construction by 1.3 percent

The International Monetary Fund said in January that Britain was on its way to being the only G7 country to record deflation in 2023, due to several reasons, including the inflation rate remaining above ten percent.

But since then, economic data has come out stronger than analysts expected

The Bank of England raised interest rates last week for the eleventh time in a row, and investors are currently divided on the possibility of raising them again in May.

The statistics office said Britain recorded a current account deficit in the last three months of last year of 2.5 billion pounds ($3.1 billion), or 0.4 percent of gross domestic product.

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