With 0.2% growth in July, the economy failed to make up ground, according to official data released today.
The result may cause further worries about UK plc’s health since experts had anticipated a 0.4% rebound after a 0.6% decline the previous month.
Additionally, there are worries that a bank holiday to commemorate the Queen’s state burial may reduce GDP by £2 billion.
A plethora of economic data is expected to be released this week, exposing the task confronting inexperienced PM Liz Truss.
Ms. Truss has already taken action to combat the stress on household budgets by unveiling a £150 billion government plan to stabilise skyrocketing energy costs.
This will increase the UK’s debt pile while easing household pressure and maybe preventing a recession.
The headline CPI rate increased to 10.2% in August from 10.1 in July, according to the Office for National Statistics, indicating that inflation is still at a 40-year high.
According to the ONS, the services sector, which expanded by 0.4% in July, made the largest contribution to the recovery.
That came after the industry saw a 0.5% decline between May and June.
However, for the second straight month, both output and construction shrank in July, by 0.3% and 0.8%, respectively.
The Queen’s Jubilee bank holiday day had an effect on the GDP number for June.
The bank holiday on next Monday can cause the economy to run into further obstacles.
According to Simon French of Panmure Gordon, one-time bank holidays have previously reduced productivity by up to £2 billion.
According to Panmure Gordon, this will likely result in the GDP contracting by 0.1% in the current third quarter as opposed to expanding by 0.1%.
The Queen’s Platinum Jubilee Bank Holiday, according to Investec analysts, had a less significant economic effect.
There aren’t many analogies, according to French. It’s possible that we’re not just discussing an additional bank holiday.
A protracted period of national mourning may occur.
Following the Queen’s passing last week, several companies had a day of closures while sporting and entertainment events were impacted.
This week, a plethora of economic data is expected to reveal the problem confronting inexperienced PM Liz Truss (pictured).
An already struggling economy might face additional challenges as a result of the recent decline in economic activity.
Real pay is declining at a historic rate because, despite wage increases, prices continue to outpace wages.
Tomorrow’s separate labour market statistics will reveal if the gap has become any wider.
However, Truss’s expensive intervention should result in the agony beginning to lessen as inflation declines. Some economists believe it will have reached its pinnacle already.