7 months ago • 2 mins
What’s going on here?
Data out on Friday showed that the British economy grew last quarter, despite March being a royal pain.
What does this mean?
March turned out to be a tricky month for the British economy. Strikes across education, transport, and health sectors put a damper on output, and even the generally dependable appeal of shiny new number plates failed to rev up car sales. Still, it wasn’t all bad news: industrial production picked up some of the slack, partly offsetting a slump in the service sector – and January and February were far sunnier, with services, manufacturing, and construction all in the green. That meant the UK managed to scrape by with growth of 0.1% for the quarter as a whole, despite an unexpected 0.3% dropoff from February to March. That’s not quite a home run, but hey: it beats shrinking.
Why should I care?
Zooming in: Close call.
That quarterly performance outstripped the Bank of England’s predictions – a nice little surprise, especially after the authority recently scrapped its recession forecast for the year. See, the central bank’s now betting on modest growth of 0.25% for 2023, a much happier outlook than the shrinkage of 0.5% it previously expected. But remember, the quarter ended with a weak March – so despite improvements to supply chains, consumer confidence, and energy prices, the country’s still on shaky ground.
The bigger picture: Good omen.
The UK is lagging behind its pals, with its economy (0.5% smaller than in pre-pandemic days) sitting right at the bottom of the Group of Seven nations ever since Covid hit. And while almost no growth isn’t really much to celebrate, the nation’s recent performance could be a good sign for other countries: after all, if the truly hard-hit UK manages to sidestep a recession, then there’s probably hope for its less-troubled peers too.
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