The UK economy unexpectedly contracted 0.3 percent on a monthly basis in April, official figures showed Monday, raising fears of a recession three days before the Bank of England raises its latest interest rate hike.
The average opinion of economists in the Reuters poll indicates that GDP growth in April was 0.1 percent compared to March. For the first time since January 2021, all major economic sectors have made a negative contribution to the monthly GDP estimate, according to the National Bureau of Statistics.
However, the office noted that GDP would have grown by 0.1 percent, excluding the impact of reducing government programs for testing, detecting contacts with people infected with the corona virus, and vaccinating against the virus.
In the three months to April, GDP rose 0.2 percent, down sharply from 0.8 percent in the three months to March. The Reuters poll suggests 0.4 percent growth for the February-April period.
The main reason for the decline in the service sector was the shrinking of the social work and health sector by 5.6 percent after the deregulation of anti-corona controls, with “a sharp drop in NHS testing and tracking activity”.
Citizens showed signs of resilience despite high inflation. Statistics show that consumers are slowing down from a 54 percent increase in energy tariffs last April and an increase in government wage taxes … The latest data shows consumers are cutting back on buying non-essential items.
In a parallel context, Britain on Monday unveiled its first national food strategy, focusing on increasing domestic production to improve food security rather than deal with obesity, after rejecting a proposal to tax salt and sugar in processed foods.
The government said Russia’s invasion of Ukraine had damaged food supplies and pushed up prices, underscoring Britain’s need to increase food security. He said the project would increase production in some sectors such as agro-products and seafood while broadly maintaining the current level of food produced locally. The government has said the agriculture sector will receive a total of 0 270 million ($ 333 million) in innovation investment by 2029.
Prime Minister Boris Johnson said the strategy would help farmers and protect food items from future economic shocks. “By utilizing new technologies and innovations, we will grow our food more, create jobs across the country and grow the economy, which will ultimately help reduce the pressure of prices,” he said in a statement.