UK economic growth slows in first quarter

The pace of British economic growth slowed in the first quarter of the year compared to the last three months of last year, when the country was facing a rise in inflation, official data showed on Thursday.

The economy grew by 0.8% in the January-March period, from 1.3% in the fourth quarter of last year, and after a strong output in January, the British economy contracted to 0.1%, registering zero growth next month. In March, according to the agency, Agency France-Press for the National Statistics Office.

This comes after the Bank of England warned last week that Britain was facing a recession at a time when the UK inflation rate is expected to cross 10%.

Official explanation for Britain’s slow growth
Consumer prices around the world are rising under the pressure of supply chains as economies reopen following the epidemic locks, and Russia’s invasion of Ukraine is driving up higher energy prices.

Commenting on the data on Thursday, British Finance Minister Rishi Sunak said his country’s economic recovery from the epidemic was “hampered by Putin’s barbaric invasion of Ukraine and other global challenges” (by Russian President Vladimir). But Sunak added in a statement that the United Kingdom had “stronger growth in the first few months of the year than recorded in the United States, Germany and Italy”.

Although the UK economy continued to grow in the fourth quarter and has now surpassed pre-epidemic levels, production in the first three months of 2022 was the lowest in a year.

“Our latest monthly estimates show that GDP fell slightly in March, while both services and output declined,” said Darren Morgan, director of the Bureau of Statistics’s Economic Statistics, for maintenance following the February storms. He explained that the growth recorded in the first quarter was driven by improvements in several service sectors, including hospitality and transport.

A new tariff hike is expected in the UK
But the contraction in March and the slump in production in the first quarter “indicates that the pace of the economy was slower than we thought before realizing the full impact of the cost of living crisis,” said Paul Tales, the UK’s chief economist. In the capital economy.

“The risk of a recession has now increased,” he said, adding that “strong pressures from prices mean that the Bank of England will raise rates further.”

The Bank of England last week raised its core interest rate by a quarter point to 1 percentage point. This is the fourth consecutive increase announced by the bank, which has brought its base interest rate to its highest level since the global financial crisis in 2009.