Inflation-racked UK economy stagnates, figures show

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The UK has seen no economic growth in three months, the country’s Office for National Statistics reported on Thursday.

Britain’s economy has flatlined, as post-Brexit trade and other vital sectors continue to perform poorly, new figures reveal. 

The Office for National Statistics (ONS) said on Thursday the economy has “shown no growth” in three months, with production shrinking the most.

Monthly GDP growth – measuring the total value of goods and services produced in a country – fell by 0.1% in May after a brief rise of 0.2% in April. 

The figures will likely add pressure to Rishi Sunak’s Conservative government, with the Prime Minister including “growing the economy” as one of his five core pledges at the start of the year. 

Factory output fell the largest in May by 0.6%, construction declined by 0.2% and the services sector remained stagnant, with no change on the previous month, according to the ONS. 

Inflation in the UK has remained stubbornly high, battering households and some businesses. It stayed at 8.7% in May, despite predictions it would fall. 

Writing on Twitter, Resolution Foundation economist said the ONS data shows the UK is suffering “weak export performance in key manufacturing sectors”. 

Exports to the EU fell by 6.8%, compared to a 2.1% drop with the rest of the world, she pointed out. 

A public holiday for the King’s coronation contributed to decreased manufacturing and construction output, the Office for National Statistics said.

“GDP fell slightly as manufacturing, energy generation and construction all fell back, with some industries impacted by one fewer working day than normal,” ONS Director of Economic Statistics, Darren Morgan, said. 

Strikes in the public sector and industries also hit the economy, according to the report, with “industrial action”  on the railways having an adverse effect.   

The disruptions caused the GDP of food and beverage services to fall drastically – the most out of all the sub-categories. 

However, the coronation bank holiday positively affected the arts and entertainment sector, the report added.

The entertainment industry had the second-largest growth, only led by human health and social work activities, to prevent the economy from succumbing further.

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