The UK economy experienced a minor increase in August, with a growth of 0.1% as reported by the Office for National Statistics (ONS). This follows a contraction of 0.1% in July, which was revised from an earlier figure of zero growth. As economic concerns persist, the government has prioritized economic enhancement, especially with the Budget approaching next month.
Economists have raised alarms about the need for tax increases or spending reductions to adhere to the chancellor’s borrowing targets. The Institute for Fiscal Studies has estimated that Labour’s shadow chancellor, Rachel Reeves, must identify £22 billion to address a financial shortfall, suggesting that tax hikes are likely. In a statement on Wednesday, Reeves indicated a review of further tax and spending measures to ensure balanced public finances.
While monthly growth figures can fluctuate, the ONS emphasizes monitoring economic performance over a three-month span. For the three months ending in August, the economy expanded by 0.3%, which reflects a slight improvement from prior data. Liz McKeown, ONS director of statistics, noted that economic growth showed a minor uptick during this latest period.
The growth in services remained stable, with business rental and leasing, along with healthcare, being significant contributors. However, certain consumer-facing services and the wholesale sector reported weaker performance, indicating mixed results within the overall economy. The ongoing assessment of these factors raises questions about the sustainability of growth amid anticipated fiscal adjustments.
Source: https://www.bbc.com/news/articles/cq65j9pm508o?at_medium=RSS&at_campaign=rss