British economy shrinks for first time in seven years
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The UK’s economy has unexpectedly shrank 0.2 per cent in the second quarter – its first contraction since the last quarter of 2012, when GDP fell by the same amount.
GDP last fell by more in early 2009, when the economy was deep in the post-financial crisis recession.
Ahead of tday’s official data release, both the Bank of England and City economists had expected zero economic growth in the April-June period, after a 0.5 per cent rise in GDP in the first quarter.
Rob Kent-Smith, head of GDP at the Office for National Statistics (ONS) said manufacturing output had fallen and the construction sector weakened.
GDP last fell by more in early 2009, in middle of post-financial crisis recession.
The pound slipped after the data was released this morning, raising fears of a recession.
“Manufacturing output fell back after a strong start to the year, with production brought forward ahead of the UK’s original departure date from the EU,” said Mr Kent-Smith.
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