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UK economy shrinks less than feared as recession risk looms
Updated 16:31, 11-Nov-2022
CGTN

Britain's economy shrank by a less severe than expected 0.2 percent in the three months to September, according to official data which is likely to represent the start of a lengthy recession.

A Reuters poll of economists had pointed to a bigger contraction of 0.5 percent in gross domestic product in the third quarter.

The Bank of England said last week that Britain's economy was set to go into a two-year recession if interest rates rose as much as investors had been pricing.

Even without further rate hikes, the economy would shrink in five of the six quarters until the end of 2023, it said.

The weak economic outlook provides a tough backdrop for next week's budget statement by finance minister Jeremy Hunt.

Responding to Friday's data, he repeated his warnings of tough decisions on tax and spending in order to repair Britain's public finances and the government's credibility on economic policy after Liz Truss's brief spell as prime minister.

"I am under no illusion that there is a tough road ahead – one which will require extremely difficult decisions to restore confidence and economic stability," Hunt said in a statement.

"But to achieve long-term, sustainable growth, we need to grip inflation, balance the books and get debt falling. There is no other way."

(Cover: Commuters walk past the closed Underground entrance at Victoria Station during the morning rush hour as the capital's transport system is severely disrupted due to strike action by Tube workers in London, United Kingdom, November 10, 2022. /CFP)

Source(s): Reuters

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