In November, the UK economy experienced growth due to an increase in consumer spending, particularly during Black Friday sales. Shoppers were on the lookout for deals as the holiday shopping season began.
According to the Office for National Statistics (ONS), there was a 0.3% increase in gross domestic product in comparison to a 0.3% decrease in October. City economists had predicted a smaller growth of 0.2%.
The ONS’s leading economist, Grant Fitzner, stated that the recovery was driven by the services industry, particularly in retail, car leasing, and video game companies, all of which had a successful month.
“The overall outlook continues to reflect an economy that has experienced minimal expansion in the past year,” he stated.
Recent statistics revealed that several major British retailers had a successful holiday shopping season, thanks to an increase in digital purchases and a strong desire for holiday food and beverages. However, there was a lack of interest in more expensive products like furniture and electronics.
According to the ONS, there was a 0.3% increase in services output in November, following a decrease in October due to strikes in the health and education sectors. Production output, which includes manufacturing and energy generation, also saw growth. However, the construction sector experienced a 0.2% decline in activity.
During the three-month period leading up to the end of November, it is estimated that GDP decreased by 0.2%. This decline is attributed to the strain on households due to the current cost of living crisis.
Yael Selfin, the leading economist at KPMG UK, stated that the general forecast remained “bleak”, with a potential for a technical recession in the latter half of 2023.
She mentioned that the economy is predicted to continue in a state of stagnation, even if it avoids a recession.
The most recent data arrives amidst increasing beliefs that the Bank of England will lower interest rates this year due to a decrease in inflation from its peak in the last 40 years. The upcoming official statistics are predicted to reveal a cooling in inflation from 3.9% in October to November, but individuals still face significant strain as prices remain elevated.
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The statement from Chancellor Jeremy Hunt expressed satisfaction with the news of growth returning in November, but also warned that progress may be hindered by ongoing inflation decrease.
The speaker stated that countries with lower taxes have experienced greater economic growth, thus our tax reductions for both businesses and workers will benefit the UK’s future growth.
Source: theguardian.com
