UK economy barely grew in October, GDP up by 0.1%

  • Economists polled by Reuters had forecast monthly gross domestic product growth of 0.4% from September.
  • The weak figures are likely to add to expectations the Bank of England will next week keep interest rates on hold once again, despite having recently signaled it is on course for its first hike since the pandemic.

Britain's economy grew by a weaker-than-expected 0.1% in October, leaving it 0.5% smaller than it was in February 2020, just before the country went into its first COVID-19 lockdown, the Office for National Statistics said on Friday.

Economists polled by Reuters had forecast monthly gross domestic product growth of 0.4% from September.

The weak figures are likely to add to expectations the Bank of England will next week keep interest rates on hold once again, despite having recently signaled it is on course for its first hike since the pandemic.

Britain's economy bounced back strongly earlier this year from its nearly 10% slump in 2020 when the pandemic hit.

But the rebound slowed in recent months as supply chain problems hit manufacturers and it is expected to lose more momentum due to new COVID-19 rules to slow the spread of the Omicron variant of the coronavirus.

October's growth was helped by a continued rise in face-to-face appointments at doctors' surgeries in England which had fallen sharply during the coronavirus pandemic, contributing to a 0.4% rise in output in Britain's dominant services sector.

By contrast, industrial output fell 0.6%, hit by big falls in electricity and gas and in mining and quarrying.

The manufacturing sector flat-lined as the sector struggled with supply chain problems and staff shortages.

Construction fell by the most since April 2020, down by 1.8% from September.

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