The United Kingdom Office for National Statistics [ONS] unveiled revised data illustrating the state of the economy on Friday, March 31. According to the report, growth of 0.1% was registered in the fourth quarter last year, implying that the UK has officially dodged a 2022 recession. estimated no growth [0.0%].
GDP is estimated to have grown at a revised 0.1% in the fourth quarter (Oct to Dec) of 2022.
Higher than an initial estimate of 0.0% growth.
https://t.co/Q7Lah5zn7G pic.twitter.com/SMEGkiNpOy
— Bureau of National Statistics (ONS) (@ONS) March 31, 2023
Contributing Factors
The construction sector had a good quarter, registering a 1.3% growth. Other sectors, such as telecommunications, also performed well. Commenting on the latest revised figures, ONS Director Darren Morgan said:
“The economy performed slightly stronger in the second half of last year than previously estimated, with later data showing telecommunications, construction and manufacturing all outperformed in the last quarter.“
The most recent data indicated that living standards in the UK have risen for the first time in more than a year. This probably means that the cost-of-living crisis is abating. In particular, the household savings rate increased to 9.3% in Q4 2022, up from 8.9% in the previous quarter. Morgan continued the same, saying:
“Households saved more in the last quarter, with their finances boosted by the government’s utility bill support scheme.“
In addition, there is also the UK’s balance of payments deficit with the rest of the world shrunk. The higher foreign earnings of UK companies, especially those in the energy sector, helped promote the same. It should be noted that business investment is now estimated to be 2.2% below its pre-pandemic level, revised down from previously flat. The ONS report noted,
“The implied price rose 0.7% in the fourth quarter of 2022, an upward revision from the initial estimate of a 7.2% decline. These revisions are due to updated estimates, especially for transport products, and seasonal adjustments.“
Source: US
The Chancellor of the Exchequer, Jeremy Hunt, went on to claim that “there is an underlying resilience in the UK economy”. In fact, the general outlook is now brightened up. Per Independent economist Julian Jessop, there is “a little more momentum than expected in 2023.”
“There is underlying resilience in the UK economy.”
Jeremy Hunt has commented on data confirming that the UK economy avoided recession in the second half of last year.
He also spoke of the UK’s acceptance into an Indo-Pacific trade bloc.https://t.co/PAiZ4D1jU3
Heaven 501 pic.twitter.com/pYnt9sATnW
— Sky News (@SkyNews) March 31, 2023
Apart from the UK, inflation seems to be cooling even in the US. The CPI fell to7.1% in Novlast year a number lower than expected. Similarly, it continued to fall to6.5% in DecemberAnd6.4% in Januarythis year. The number was even lower in February, with the CPI reading falling to 6%.
Read also: Inflation in the US falls to 6% in February