UK economy grows for first time in three months


In November, the UK economy grew by 0.1% for the first time in three months. This growth was mostly due to the services and construction sectors, specifically the boost in trade for pubs, restaurants and new commercial developments. However, it was lower than expected, as manufacturing and business rentals and leasing declined during the same period, said the Office for National Statistics. In the three months to November, the economy is estimated to have shown no growth, demonstrating its “broadly flat” status.

Chancellor Rachel Reeves reiterated her promise to “further and faster” improve economic growth to boost living standards, declaring it the government’s “number one priority”. She believes that specific actions such as generating investment, driving reform, and a relentless commitment to root out waste in public spending would help achieve this objective. Reeves is meeting with representatives of several of the biggest regulators across different spheres such as energy watchdog Ofgem and the Competitions and Markets Authority to get suggestions for growing the economy.

Businesses remain concerned that the tax hikes set to come into effect in April, including National Insurance and the minimum wage, could impact the economy’s ability to grow. Such extra costs could leave employers with less money to create new jobs and give pay rises, as warned by the employers. The return of growth is a welcome sign for the government that had recently suffered financial instability and higher borrowing costs. The value of the pound also fell, which the government will look to stabilise in the future.

Ms McKeown of the Office for National Statistics (ONS) said that November’s growth was driven in part by improved trade in the services industry and the expansion of commercial developments in construction. However, production continued to decline in November, with manufacturing, accountancy and business rental and leasing all suffering from further falls. The country’s current “broadly flat” status has prompted Reeves and the government to take concrete steps to generate economic growth and create jobs

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