The UK has entered recession for the first time since the pandemic

The UK economy contracted in the fourth quarter of 2023 for the second consecutive period, meaning the country has entered recession, the Office for National Statistics (ONS) said on Thursday.

According to a statement from the ONS, Britain’s GDP fell 0.3% in the fourth quarter of last year, after falling 0.1% in the third quarter.

THE high interest rates and inflation They have put pressure on the economy on families and businesses, which, in the midst of an election year, complicates the task of the conservatives in power.

Two consecutive quarters of economic contraction is often considered by economists to be the definition of an economic contraction a “technical” recession.

However, in the full year 2023, the UK continues to show slight growth of 0.1% year-on-yearfollowing growth of 4.3% in 2022, the ONS said.

The recession was mainly caused by poor results for businesses in December, in the midst of the Christmas period and traditionally the peak time of year for this sector, according to the ONS.

Therefore, the British economy goes into recession for the first time since 2020when lockdowns began to fight the coronavirus pandemic influenced economic activity For me yes.

The ONS notes that the UK economy “is recording its worst performance since the 2009 crisis, excluding 2020”.

The problem of inflation

“Inflation is the biggest obstacle to growth, so halving it has been our priority,” said Chancellor of the Exchequer Jeremy Hunt.

Inflation in the UK stands at 4%Still double the Bank of England’s target, but it fell compared to 11% reached in October 2022.

“With high interest rates – currently 5.25% – the Bank of England can reduce inflation, weak growth is no surprise“The hunt continued.

“But there are signs that the British economy has turned a corner and Forecasts speak of growth for the next few years“, the minister said.

Economists they relativize the scope of this recession.

“It’s moderate”

“It is moderate and leading indicators suggest it is already coming to an end,” economist Ruth Gregory of Capital Economics said in a statement.

But Gregory made it clear that “the announcement that the UK has entered a technical recession in 2023 will be a blow to the Conservative Prime Minister”, Rishi Sunak.

THE Work currently has a clear advantage in polls on the Conservatives, who have been in power for around 14 years, ahead of this year’s elections, which They don’t have an appointment yet.With information from the Associated Press