Britain is in recession, official data showed Thursday, dealing another deadly blow to embattled Prime Minister Rishi Sunak, whose Conservative Party is forecast to lose a general election expected this year.
Gross Domestic Product (GDP) shrank 0.3 per cent in the fourth quarter of 2023 after contracting 0.1 per cent in the prior three months, the Office for National Statistics (ONS) said in a statement. That places the economy in recession, which is defined as two quarters of falling GDP in a row.
While economists predicted that the recession could be short-lived, the data is a big setback for Sunak, who has placed economic growth as a key priority. It comes as the Conservatives badly trail the main opposition Labour Party in polls.
Ahead of the general election, voters take part in two by-elections on Thursday, with the Conservatives fearful of losing one-time strongholds in Wellingborough, central England, and Kingswood in the southwest.
“The news that the UK slipped into technical recession in 2023, will be a blow for the prime minister on a day when he faces the prospect of losing two by-elections,” said Capital Economics analyst Ruth Gregory.
“But this recession is as mild as they come and timely indicators suggest it is already nearing an end.” In a broad-based decline, all main sectors shrank in the fourth quarter — with manufacturing and construction among the biggest drags.
The economy was broadly flat last year with 0.1-per cent expansion, down sharply from growth of 4.6-per cent growth in 2022, the ONS added. The news came on the same day it emerged that Japan has also entered recession according to reports by CNN.
