UK Economic Growth Stalls in January with a 0.1% Decline

Image Credit: Reuters

Britain's economy unexpectedly shrank by 0.1% in January, primarily due to a significant decline in manufacturing output compared to December, according to data from the Office for National Statistics. Economists had predicted a modest growth of 0.1% for the month. While the contraction in January partially offsets a 0.4% growth in December, it is still a setback for Finance Minister Rachel Reeves, whose main goal is to stimulate economic growth.

For the three months ending in January, the economy grew by 0.2%, slightly below the 0.3% consensus forecast from a Reuters poll.

Manufacturing output dropped by 1.1% in January, with the metals and pharmaceutical sectors experiencing particularly poor performance, while the broader industrial sector was also affected by a decrease in oil and gas extraction.

The services sector, however, saw a 0.1% increase in output, marking its third consecutive month of growth. Construction output fell by 0.2%, with anecdotal reports from companies attributing the decline to stormy weather disrupting construction activities.

 

 

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