The chancellor says data showing the UK economy shrank by 0.3% reflects a “challenging” situation.
Image source, Getty ImagesThe UK economy shrank between August and October as the country heads into an expected recession.
The economy contracted by 0.3% during the three months as soaring prices hit businesses and households.
A country is in recession when its economy shrinks for two three-month periods in a row,
Over the three months, economic activity in the UK slowed across all the main sectors including production, construction and services.
The UK is widely expected to be in recession by the end of this year. The Bank of England recently said the UK is facing its longest recession since records began.
There was a brief respite in October alone when the economy grew by 0.5% compared to September when it fell because of an additional bank holiday for Queen Elizabeth’s state funeral. It meant that some businesses had closed or had shorter opening hours.
But Chancellor Jeremy Hunt said: “While today’s figures show some growth, I want to be honest that there is a tough road ahead. Like the rest of Europe, we are not immune from the aftershocks of Covid-19, Putin’s war and high global gas prices.”
Labour’s shadow chancellor Rachel Reeves said the figures “underline the failure of this Tory government to grow our economy, leaving us lagging behind on the global stage”.