UK economy fails to grow for third month in a row as Brexit effect takes hold

The UK economy unexpectedly in the three months to October, marking the third consecutive month of zero or negative growth, official figures show.

It is the first time that the economy has failed to grow for three straight months since the aftermath of the financial crisis in 2009. Analysts had predicted 0.1 per cent growth in October.

The services sector grew marginally in the latest quarter but construction output fell by 2.3 per cent in October, the Office for National Statistics said.

Gross domestic product was up 0.7 per cent in October compared to a year earlier, the slowest annual rate in more than seven years.

The UK in on course for little over 1 per cent growth this year – its worst full-year performance in a decade. 

Stockpiling ahead of the prime minister’s Brexit deadline on 31 October was less pronounced than ahead of the first deadline in March.

More bad news could be in store for Boris Johnson, with recent surveys for November’s outlook indicating contraction in all major sectors of the economy.

The major parties have offered differing views of how to tackle the country’s economic malaise after Thursday’s general election.

Mr Johnson’s Conservatives have pledged to unleash the UK’s growth potential by completing the Brexit process and a new EU trade deal by the end of next year, a timetable that has been criticised as unrealistic.

Labour promises to borrow to invest in stimulating the economy, spending big on infrastructure and creating new jobs in green industries.

Howard Archer, chief economic advisor to the EY Item Club said: “We expect GDP growth to be limited to 1.3 per cent in 2019, which would be the weakest performance since 2009 and down from 1.4 per cent growth in 2018. The economy got off to a poor start to the fourth quarter amid a myriad of uncertainties – Brexit, domestic political, global economic – after stuttering in the latter part of the third quarter.”


READ  Forcing pay ratios into the open doesn’t change anything in itself


Please enter your comment!
Please enter your name here