STORY
The UK economy unexpectedly contracted in the latest monthly figures, raising fresh fears about the country’s economic direction and undermining hopes of a stable recovery. Official data showed that output slipped by 0.1 per cent, defying predictions of modest growth and extending a period in which the economy has failed to build any sustained momentum.
Weakness in services, construction and manufacturing all contributed to the downturn, with consumer spending and business confidence appearing to falter in the run-up to the winter period. Analysts warned that the combination of hesitant investment, stubborn costs and subdued demand could push the UK uncomfortably close to a technical recession if the trend continues.
The unexpected economic announcement will also cause concern to Rachel Reeves, the Chancellor of the Exchequer, who has been accused of not doing enough to help employers create jobs. A spokesperson for Reeves said:
“We are determined to defy the forecasts on growth and create good jobs, so everyone is better off, while also helping us invest in better public services.”