“The autumn in March was pushed by widespread decreases throughout the companies sector,” stated Darren Morgan, from the Workplace for Nationwide Statistics.
“Regardless of the launch of latest quantity plates, automotive gross sales have been low by historic requirements – persevering with the pattern seen for the reason that begin of the pandemic – with warehousing, distribution and retail additionally having a poor month.” Widespread industrial motion additionally weighed on financial exercise within the quarter, the ONS stated.
Britain’s economic system remained 0.5 per cent smaller than within the fourth quarter of 2019, shortly earlier than the coronavirus pandemic – a weaker rebound than some other main superior economic system.
“With the important thing companies aspect of the economic system persevering with to sluggish within the face of upper borrowing prices and rising costs, it nonetheless seems like we’re strolling via treacle,” stated Tom Stevenson, private investing director at Constancy Worldwide.
“With inflation nonetheless in double digits, it feels depressingly like a re-run of Seventies stagflation.” Output in March was solely 0.1 per cent greater than in February 2020, the final full pre-pandemic month.
“A weaker economic system in March underscores its fragility regardless of a fall in wholesale power costs, bettering provide chain circumstances, and shopper confidence that has additionally recovered from multi-year lows,” KPMG economist Yael Selfin stated.
“Whereas recession might be now not on the playing cards, vulnerabilities ensuing from greater borrowing prices and tighter credit score are prone to dampen enterprise and family exercise this 12 months.” The Financial institution of England forecast on Thursday that Britain’s economic system would develop 0.25 per cent in 2023 as a complete – a weak growth however an improve on its earlier prediction of a 0.5 per cent contraction.
Britain’s inflation price topped 10 per cent in March – double the extent in the USA and better than the euro zone’s too – and it’s also fighting a decent labour market, a string of rate of interest hikes and after-effects of Brexit.
Finance minister Jeremy Hunt stated after the information that it confirmed the necessity for the federal government “to remain centered on aggressive taxes, labour provide and productiveness”.