LONDON — U.K. gross domestic product rose 0.1% in February, the Office for National Statistics said on Friday, providing another sign of a return to sluggish economic growth this year.
The economy contracted in the third and fourth quarters of 2023, putting the U.K. in a technical recession.
January recorded light growth, which was revised upward to 0.3% on Friday.
Construction output, which boosted growth at the start of the year, fell 1.9% in February.
Instead, production output was the biggest contributor to the GDP, rising by 1.1% in February, while growth in the U.K.’s dominant services sector slowed to 0.1% from 0.3%.
The reading “all-but confirms the recession ended” last year, Paul Dales, chief U.K. economist at Capital Economics, said in a note.
There is quite a lot of pressure from the governing party, not necessarily the prime minister but the chancellor has talked about expecting rate cuts.”
Overall, French said the figures strongly indicated the end of the recession but were “not a reason to hang out the bunting.”
London — U. KK. The Office for National Statistics reported on Friday that the gross domestic product increased by 0.1 percent in February, which is another indication that this year’s slow growth in the economy is returning.
The monthly amount matched a forecast from a Reuters survey. The GDP decreased by 0.2 percent on an annual basis.
In 2023, the economy shrank in the third and fourth quarters, placing the U.S. KK. in a recession of technology.
Light growth was reported in January, but on Friday, it was revised up to 0.3 percent.
The output of construction, which spurred growth at the beginning of the year, decreased by 1.9% in February. Rather, the largest contributor to the GDP was production output, which increased by 1.1 percent in February despite growth in the U.S. K. the leading services sector of the economy decreased to 0.1 percent from 0.3 percent.
Per Paul Dales, chief U.S. economist, the reading “all-but confirms the recession ended” last year. K. a note from a Capital Economics economist.
Even though we anticipate a stronger economic rebound than most, we don’t think it will be robust enough to stop inflation (and interest rates) from declining much more, as seems to be the case in the U.S. s. “Dales also mentioned.
Inflation in the UK dropped more than anticipated in March, reaching a nearly two-and-a-half-year low of 3 percent.
Within the U. s. Price increases this week, however, came in higher than anticipated at 3.5 percent, delaying market bets for the beginning of interest rate cuts from the summer to September.
This has sparked concerns about whether central banks abroad will be affected by the Federal Reserve starting later than anticipated, especially if the U. s. The dollar gains strength.
The Bank of England will likely cut rates four times this year instead of five, according to Goldman Sachs’ revised forecast on Friday. The rate cuts are expected to begin in June and then gradually slow to a quarterly pace after that.
Even though the BOE is independent, Simon French, chief economist at Panmure Gordon, said on Friday on CNBC’s “Squawk Box Europe,” policymakers will still be aware of an impending U. G. Politicians have proposed holding a national election in the second half of the year.
There is a lot of pressure from the governing party, not just the prime minister but also the chancellor, who has expressed expectations of rate cuts. Do you get [cuts] out of the way ahead of that general election? ****.
French said that while the numbers were “not a reason to hang out the bunting,” they did indicate that the recession was ending overall. ****.
