here was no growth in the UK economy in February, as GDP figures came in below expectations.
Strikes contributed to the lack of growth, as did declines in the use of energy, according to the ONS.
GDP was unchanged from January, when the economy grew by a better-than-expected 0.4 per cent.
The performance was slightly below the expectations of economists, who had predicted growth of 0.1 per cent.
“UK GDP was flat in February, after growing by 0.4 per cent in January, as growth in construction was offset by falls in services and production.”
“The economy saw no growth in February overall,” ONS director of economic statistics Darren Morgan said. “Construction grew strongly after a poor January, with increased repair work taking place. There was also a boost from retailing, with many shops having a buoyant month.
Despite the stagnation, Chancellor Jeremy Hunt was optimistic. He pointed to the growth over the last three months, which he said showed the economy was performing better than had been expected.
“The economic outlook is looking brighter than expected – GDP grew in the three months to February and we are set to avoid recession thanks to the steps we have taken through a massive package of cost of living support for families and radical reforms to boost the jobs market and business investment.”
“These were offset by the effects of Civil Service and teachers’ strike action, which impacted the public sector, and unseasonably mild weather led to falls in the use of electricity and gas.”
The figures suggest that the country is still likely to avoid a recession this year – as predicted by the Bank of England and OBR – but do not completely allay fears of a decline.
“The UK economy likely to escape recession but a period of stagnation awaits” says Yael Selfin, Chief Economist at KPMG UK.
“A combination of upward revisions in GDP data and an improvement in global economic conditions could help the UK economy avoid a recession this year. While this will provide relief for policymakers, the outlook for growth in the medium-term remains relatively weak by historical standards.
