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The UK economy unexpectedly signed 0.1% in January, taking a blow to Prime Minister Rachel Reeves ahead of this month’s High Stakes Spring statement.
The National Bureau of Statistics’ monthly GDP figures on Friday were below both the 0.1% growth forecast by economists voted by Reuters and the 0.4% in December.
The Prime Minister is preparing to curb public spending after a spring statement on March 26th disappointing growth and causing fear that government borrowing numbers have been on track to break fiscal rules.
President Donald Trump’s fallout from the escalating trade war has been added to the headwinds facing Britain.
The pound has weakened slightly since data release, down 0.2% against the dollar at $1.292.
The Bank of England is expected to hold 4.5% at next week’s meeting amid a flicker of revived inflation. Last month, BOE reduced its first quarter 2025 economic growth forecast to 0.1% from 0.4% in November.
Labour won the general election last July with a promise to start growing, but Reeves faced criticism of the October budget, which has given businesses the brunt of £40 billion in tax cuts.
This is a developing story
