On Friday, the Office for National Statistics released figures showing that the British gross domestic product (GDP) grew by 0.1% in the first quarter of 2023, despite a

0.3% unexpected dip in output in March. Although economists surveyed by Reuters had predicted 0.1% quarter-on-quarter growth for Q1 2023, they had expected steady growth in the final month of the quarter.

According to ONS statistician Darren Morgan, the decline in March was driven by a general reduction across the services sector, which had a negative impact on retail, warehousing, and distribution, as well as on car sales, which continued to be low by historical standards. Additionally, widespread strikes further hampered economic activity in the first quarter.

While the UK economy remained 0.5% smaller than it was in Q4 2019, just before the pandemic, the data showed that it was 0.1% larger than it was in February 2020 on a monthly basis.

The Bank of England predicted on Thursday that the UK would experience a weak expansion of 0.25% in 2023, avoiding a recession, having previously predicted a contraction of 0.5%. The UK is grappling with an inflation rate that soared to 10% in March, double the level in the United States and higher than that in the euro zone. Additionally, it has a very tight labour market, a string of interest rate hikes, and is dealing with the after-effects of Brexit. Photo by Jim Goldsmith, Wikimedia commons.