Economic Insights: UK Growth Analysis
Recent official statistics reveal that the British economy experienced a modest growth of 0.1% in the fourth quarter of 2024 compared to the previous quarter, surpassing expectations observed in December.
Contrary to analyst predictions, which suggested a lack of GDP growth in the last quarter of the year, the actual figure stood at 0.1%.
According to data released by the British National Statistical Office, the economy grew by 1.4% year-on-year in the fourth quarter, surpassing forecasts that anticipated a growth of 1.1%.
This growth can be attributed to a 0.4% increase recorded in December, attributed mostly to robust activity in the hospitality sector, particularly leading up to the holiday season, which ultimately contributed to the positive results of the fourth quarter.
Total growth for the British economy in 2024 was approximately 0.9%.
The uptick in the annual growth for the fourth quarter of 2024 arrives after three months of stagnation, easing some of the pressure on Treasury Secretary Rachel Reeves. She has faced criticism regarding the economic slowdown coinciding with the resumption of the Labor Party’s leadership since July.
Despite a weak performance in the first half of last year, characterized by a recession in the latter half of 2023, the economy’s growth slowed again in the second half of 2024, showing no growth in the third quarter.
The British economy has been beleaguered by factors such as declining demand across Europe, elevated energy prices, and potential slowdowns in global trade linked to tariffs imposed during the Trump administration.
Recently, the Bank of England revised its growth forecast for the British economy in 2025 downward to 0.75% and has adjusted the main interest rates to 4.5%.
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