The British economy is entering a recession

The British economy is entering a recession

LONDON (ANP/RTR/Bloomberg) – The British economy has entered a recession. This causes great difficulties for British Prime Minister Rishi Sunak, who promised in the run-up to the new elections that he would work to develop the economy.

The British economy contracted by 0.3 percent in the three months to December, according to the British statistics agency. This means that the economy has performed worse than mainstream economists expected.

There was already a contraction of 0.1 percent in the summer period. Economists usually talk about a recession when there are two consecutive quarters of contraction.

High inflation

Sunak made economic growth one of his five key promises last year. But figures show the British economy is stagnating in his first full year as Prime Minister.

High inflation in particular troubled British consumption. The country's economy was also clearly affected by the rapid rise in interest rates, which led to higher borrowing costs. In addition, there were many strikes in the United Kingdom, because employees, for example, in healthcare and public transport demanded higher wages. These strikes also suppressed the economy.

See also  Moody's Analytics on COVID-19 Outbreak in Asia, Fed Rate Raise in 2023

Leave a Reply

Your email address will not be published. Required fields are marked *