The UK economy slowed more sharply than expected in February, reflecting a hit to car production from component shortages, storm disruption and reduced health spending as households braced for a tighter cost-of-living squeeze.
Monthly gross domestic product growth was just 0.1% in February compared with 0.8% in January, the Office for National Statistics said on Monday
Services grew 0.2% , manufacturing fell 0.4% and construction fell 0.1%.The ecopnomy now stands 1.5% above its pre-pandemic level.
Services are now 2.1% above its pre-coronavirus level, while construction is 1.1% above and production is 1.9% below. Within services, consumer-facing services are now 5.2% below their pre-coronavirus levels, while all other services are 4.0% above.
TUC General Secretary Frances O’Grady said:
“The cost of living crisis is putting the brakes on our recovery as households cut back their spending. The Chancellor must come back to parliament with an emergency budget to keep families out of hardship and to keep the economy moving.”
Alpesh Paleja, CBI Lead Economist, said:
“Following the bounce at the start of the year, it’s no surprise that economic growth slowed in February. Near-term challenges to the outlook have ramped up since, with a growing cost-of-living crunch set to weigh on growth.
“Businesses are also grappling with headwinds from the Ukraine conflict, which is exacerbating cost pressures and supply chain disruption.
“It’s clear that growth impetus remains underwhelming. While the Government took some steps to sustain confidence in our economy in the Spring Statement, they don’t do enough to tackle the current challenges facing firms.
“The only enduring response to these is a relentless campaign for economic growth and productivity, through measures such as capital allowances, R&D reforms and a revised apprenticeship levy.”
