Economists warned that the risks of a recession had risen, with unions and business groups saying the Bank of England should pause its cycle of raising interest rates
in July was attributed to the impact of strike action and poor weather curbing demand for hospitality. Growing the economy is one of Rishi Sunak’s five pledges for the country ahead of the next election.
Kemi Badenoch, the Business and Trade Secretary, said: “The Government’s economic plan is working and it has been working for quite some time. The previous month’s GDP figures went up by 0.5 per cent, over the summer it went down 0.5 per cent. I would say that is stable rather than it not being something that is growing.”
Stephen Millard of the NIESR think-tank said: “We’re now expecting a fall in GDP in the third quarter of the year, which might mean the start of a recession. Big picture though is what we’ve been saying all year: whether growth is slightly positive or slightly negative is not the point; the UK economy is flatlining and this means a tough year for households.”
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