An unexpected growth was registered in the economy of the UK in November as people splurged during the World Cup, stated official data on Friday as analysts warned the country may still face recession because of a crisis due to the high cost of living.
The Office for National Statistics (ONS), issued a statement, saying that even after several strikes, the country’s gross domestic product increased by 0.1 per cent in November. The ONS said that restaurants and pubs majorly boosted the economy as people visited places to watch football matches.
From October, the growth had slowed sharply, partly because of the workers’ strike. ONS’ director of economic statistics Darren Morgan, while speaking to BBC, said, “We definitely saw the impact of industrial action in today’s figures.”
“We saw reasonably large falls in rail transport, postal work and warehousing and this sector had the biggest drag on the economy in November,” he added.
“The economy grew a little in November, with increases in telecommunications and computer programming helping to push the economy forward. Pubs and bars also did well as people went out to watch World Cup games,” Morgan said.
ONS further said that the UK economy declined by 0.3 per cent in the last three months, in comparison to the three-month period starting from August.
“Over the last three months … the economy still shrank — mainly due to the impact of the extra bank holiday for the funeral of Her Majesty Queen Elizabeth in September,” Morgan stated.
The UK government as well as the Bank of England believe that the economy is already facing recession due to rocketing inflation.
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Analyst Sophie Lund-Yates warned, “On a three-monthly basis, the UK still shrank, and a 0.1-per cent gain on a monthly basis smells heavily of stagnation, rather than real growth. The idea that the UK will formally enter a recession soon is still very much a likelihood.”
“The boost in November could stem from extra spending in the economy in the run up to Christmas, and there’s real risk now that consumers are going to tighten their belts,” the analyst added.
Commenting on the UK economy’s crisis, CBI economist Alpesh Paleja said, “High inflation is severely impacting household budgets and businesses are facing intense cost pressures. As a result, consumer spending and investment plans are weakening. The question for the government now is not whether we will fall into recession, but how long and deep the recession will be.”
(With inputs from agencies)
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