The British economy entered a recession in the second half of 2023, which created a challenging environment for Prime Minister Rishi Sunak’s expected election this year. Sunak has promised to quicken expansion.
The gross domestic product (GDP) contracted by 0.1% in July, September, and October, and then by 0.3% in the three months that followed in December, according to official data.
A Reuters poll indicated that while every expert had projected a 0.1% decline in the fourth quarter, the real reduction was more severe.
In a budget plan that was due on March 6, businesses demanded additional assistance from the government, and investors increased their bets on the Bank of England (BoE) lowering interest rates this year.
According to figures released on Thursday, Britain and Japan are now two of the Group of Seven major nations experiencing a recession, albeit one that is probably going to be mild and transient compared to previous recessions. Data on Canada’s GDP for the fourth quarter are still pending.
Barely Germany is doing worse among the G7, Britain’s GDP is barely 1% bigger than it was in late 2019, before the COVID-19 pandemic.
Getting the economy growing was one of his top pledges to voters in the previous election. His Conservative Party, known for its economic expertise, has dominated British politics for the better part of the last seven decades.
