The negative growth rate is mainly attributed to the reduced performance of services.
London: Thanasis Gavos
THE economy of the United Kingdom shrank in April after two months of stagnation, reflecting the impact of accuracy on household spending and business activity.
The latest data from the Office for National Statistics (ONS) show GDP reduction by 0.3% compared to March, despite economists’ forecasts of even marginal growth of 0.1%.
The negative growth rate is mainly attributed to the reduced performance of services. The production of the tertiary sector decreased by 0.3%, while more specifically the health sector saw a decrease of 5.6%.
ONS Director of Financial Statistics Darren Morgan said: “A sharp drop in health due to the end of the testing and tracking program pushed the British economy into negative territory in April.”
He added that the construction sector also suffered, with companies saying they had been affected by rising fuel and energy prices.
The new negatives come amid warnings for an extended period stagnant inflationwith the inflation rate at 9%, high of 40 years.
The result was a downward revision of the UK economy by the OECD and the British Chamber of Commerce.
The Confederation of British Industry (CBI) has called on the government to take “vital steps” to change the “toxic recipe” for the country’s economic development.
He warned that the recipe consisted of a number of factors threatening the national economy, such as rising cost of living, problems at airports ahead of summer holidays, planned strikes on the national railway network, and a confrontation with the EU over the Northern Protocol.
The CBI has downgraded its forecast for growth rate this year at 3.7% from 5.1% of the previous forecast and to 1% for 2023 from 3%.
Finance Minister Richie Sunak commented that the British economy is not immune to the global challenges affecting economic growth in all countries. He assured that he has a plan to boost productivity “through investments in capital, people and ideas”.
