- By Aditya Pratap Singh
- Thu, 15 Feb 2024 03:17 PM (IST)
- Source:JND
High inflation and a cost-of-living crisis plunged Britain into recession late last year, hurting Prime Minister Rishi Sunak ahead of this year's election.
Gross domestic product contracted by 0.3 per cent in the fourth quarter of 2023, compared with a contraction of 0.1 per cent in the previous three months, the Office for National Statistics (ONS) said in a report.
This puts the economy into recession, with GDP falling for two consecutive quarters. The news comes as a blow to Sunak, who has pledged to make economic development one of his top five priorities.
The ruling Conservatives are currently trailing Keir Starmer's main opposition Labour Party ahead of the general election. It also marks the United Kingdom's first recession since the first half of 2020, when the economy contracted due to the COVID-19 pandemic.
Liz McKeon, director of economic statistics at the ONS, said our preliminary forecast shows the UK economy contracting in the fourth quarter of 2023.
Although it has now contracted for two consecutive quarters, the economy remains broadly flat through 2023, he added.
All major sectors fell in the quarter, with manufacturing, construction and wholesale the biggest drags on growth, he said further.
Reacting to the data, Finance Minister Jeremy Hunt said high inflation was the biggest drag on growth. The recession data came a day after separate official data showed Britain's inflation was at 4.0 per cent from December to January, or double the Bank of England's target rate.