Recent data from the Office for National Statistics (ONS) indicates that the UK’s Gross Domestic Product (GDP) has experienced a modest growth of 0.2% in August, a notable improvement following two months of stagnation in June and July.
This positive economic shift arrives just as the government gears up for its upcoming Budget announcement at the end of October. Prime Minister Keir Starmer has indicated that some of the decisions made will be “painful,” acknowledging that certain taxes are likely to rise.
The economy’s rebound in August can be attributed to increased activity in the construction sector along with robust performances from accountancy, manufacturing, and retail businesses, contributing to the 0.2% growth after a period of no expansion.
According to Liz McKeown, the ONS director of economic statistics, “All main sectors of the economy grew in August, but the broader picture reveals a deceleration in growth in recent months compared to the first half of the year.”
UK Economic Growth Remains Below Expectations
Ben Jones, lead economist at the CBI, commented on the latest GDP figures, noting, “There are some encouraging signs, particularly from the ongoing recovery in retail, but growth across various sectors remains uneven, and overall momentum is slightly weaker than analysts had anticipated a few months ago.” He further observed that numerous firms are hesitant to proceed with hiring and investment decisions until greater clarity regarding the government’s economic policies is provided.
As the government readies for its first substantial Budgetary opportunity to outline spending and taxation priorities, these GDP figures emphasize the critical nature of economic planning. Mr. Jones remarked, “With the Chancellor’s Budget just weeks away, the government has a prime opportunity to gain traction for the economic recovery by presenting a credible strategy aimed at enhancing the country’s growth trajectory.”
Chancellor Highlights Positive Growth Indicators
Chancellor of the Exchequer Rachel Reeves addressed the recent GDP figures, stating, “It is encouraging to see growth return to the economy. Growing the economy remains the government’s top priority to ensure we can effectively support the NHS, rebuild Britain, and improve the lives of working citizens.”
“Although substantial changes won’t materialize overnight, we are committed to acting swiftly to realize the promise of change. Next week, hundreds of leading global businesses will arrive in Britain as we fulfill our commitment to fostering investment, growth, and job creation throughout the nation.”
Photo credit & article inspired by: Euronews
