The economic system grew 0.1 per cent in November, elevating the likelihood that the economic system averted coming into recession on the finish of final 12 months.
Output edged up over the month, helped by progress within the dominant companies sector, with pubs and bars having fun with a lift as folks went out to look at World Cup video games, the newest Office for National Statistics figures present.
The rise comes regardless of households and companies dealing with sustained strain from greater rates of interest and rising dwelling prices. Economists had predicted a 0.2 per cent decline.
There was a return to month-to-month progress in October with a 0.5 per cent rise in gross home product (GDP), which is the primary measure of output. The studying is assumed to have been flattered by contractions of 0.1 per cent in August and 0.6 per cent in September, when an additional financial institution vacation for the Queen’s funeral suppressed progress.
GDP fell by 0.3 per cent within the third quarter of 2022. It additionally fell by 0.3 per cent within the three months to November. Data launched subsequent month by the ONS will affirm whether or not or not the UK has entered recession.
Assuming no revisions to previous knowledge, December’s GDP might want to drop by about 0.5 per cent for fourth-quarter progress to be destructive and the UK economic system to technically enter recession. A recession is outlined as two consecutive quarters of destructive progress.
Kitty Ussher, chief economist on the Institute of Directors, mentioned it’s not sure that the economic system will meet the technical definition of a recession when the ultimate knowledge for 2022 is in. “Today’s better-than-expected knowledge will likely be encouraging for companies, however may trigger a cautious Bank of England to proceed elevating charges unnecessarily after they meet in early February. The danger now’s that charges will rise too far if inflation is already on a downward path because of adjustments in international power costs.”
Samuel Tombs, chief UK economist at Pantheon Macroeconomics, mentioned: “It is hanging within the stability as as to if the UK economic system already is in recession, following November’s barely stronger than anticipated figures.”
Ruth Gregory, senior UK economist at Capital Economics, mentioned in a word to purchasers: “Even if the economic system does a bit higher than anticipated in quarter 4, it’s at finest stagnating. And it’s too quickly to conclude the economic system will be capable of get by way of this era of excessive rates of interest and excessive inflation largely unscathed. We nonetheless assume a recession is on its method within the first half of 2023.”
At the autumn assertion the Office for Budget Responsibility mentioned that the UK was already in a recession that it anticipated would wipe out eight years of progress in dwelling requirements.
Darren Morgan, the ONS director of financial statistics, mentioned: “The economic system grew slightly in November, with will increase in telecommunications and pc programming serving to to push the economic system ahead. Pubs and bars additionally did effectively as folks went out to look at World Cup video games.
“This was partially offset by additional falls in some manufacturing industries, together with the often-erratic pharmaceutical trade, in addition to falls in transport and postal, partially because of the impression of strikes.”
Jeremy Hunt, the chancellor, mentioned: “We have a transparent plan to halve inflation this 12 months — an insidious hidden tax which has led to hikes in rates of interest and mortgage prices, holding again progress right here and all over the world.
“To help households by way of this robust patch, we are going to present a median of £3,500 help for each family over this 12 months and subsequent — however an important assist we may give is to stay to the plan to halve inflation this 12 months so we get the economic system rising once more.”