UK’s economy stands still for 2nd consecutive month despite post-election positivity
Date
9/12/2024 4:21:59 AM
(MENAFN) The expected rebound in the UK Economy following the recent general election has not materialized, as official data reveals no growth for the second consecutive month. According to the Office for National Statistics (ONS), the country’s gross domestic product (GDP) remained unchanged in both June and July. This stagnation has dashed hopes for a significant post-election economic surge, especially given that financial markets had anticipated a modest 0.2 percent increase for July.
Despite this period of flat performance, the economy had shown some resilience earlier in the year, growing by 0.5 percent over the three months leading up to July. This growth was driven by a stronger performance in the earlier quarters of 2024, with a 0.7 percent expansion in the first quarter and a 0.6 percent increase in the second quarter. These figures suggested a steady recovery from the mild recession experienced at the end of 2023.
The latest ONS data, however, indicates that the economic momentum has slowed significantly since the Labour government, led by Chancellor Rachel Reeves, assumed office in June. The weak performance during the early weeks of the new government has surprised many in the financial sector, who had hoped for a quicker economic recovery under the new administration.
Chancellor Reeves acknowledged the difficult economic outlook, expressing a realistic view of the challenges ahead. "I am under no illusion about the scale of the challenge we face," she said. "I will be honest with the British people that change will not happen overnight. Two quarters of positive economic growth do not make up for 14 years of stagnation." Her remarks underscore the substantial hurdles the government faces in reversing long-term economic stagnation and fostering a more robust recovery.
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