Official data released on Monday revealed that the British economy did not expand in the third quarter, adding to the downturn indicators that have clouded Prime Minister Keir Starmer’s new administration.
For the July-to-September period, the Office for National Statistics revised its estimate of the change in gross domestic product output from 0.1% growth to 0.0%. Additionally, the ONS lowered its growth forecast for the second quarter from 0.5% to 0.4%.
After taking office in early July, Starmer and his finance minister Rachel Reeves warned of the weak economy before introducing company tax increases in a budget on October 30 that has many employers concerned. According to analysts, the figures indicated that the economy had stagnated for the whole second half of the year.
Last week, the Bank of England predicted that the fourth quarter would see no economic growth. However, inflation remained a possibility, so borrowing costs were on hold.
The GDP drop, according to Paul Dales, chief UK economist at consulting firm Capital Economics, was partly brought on by a decline in export demand while domestic consumer expenditure remained stable.
Dales stated, “We believe 2025 will be a stronger year for the economy than 2024. However, more recent data indicates that the economy is not moving very strongly as the year draws close.
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