On Thursday, official figures were released confirming that Britain’s economy had entered a recession in the latter half of 2023. According to the Office for National Statistics, GDP decreased by 0.1% in the third quarter and by 0.3% in the fourth quarter. These figures matched the preliminary estimates that were previously reported.
While the economy saw some improvement at the beginning of 2024, with GDP growing by 0.2% in January and continued growth reported in February and March according to unofficial surveys, the recovery from the impact of the COVID-19 pandemic has been slow. Currently, Britain’s economy is only 1% larger than it was in late 2019, with Germany being the only G7 nation with a worse performance.
The Bank of England has indicated that British inflation is nearing a level where they can begin reducing interest rates. The Bank expects the economy to grow by just 0.25% this year, while official budget forecasters are more optimistic, expecting a 0.8% expansion in the economy.
Following the release of this data, there was no significant movement in the value of sterling against other major currencies such as US dollar or euro due to their stability despite some fluctuations earlier on due to other global economic factors affecting them too
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