The recession is likely to be mild and short lived, with no major changes in the day to day life of consumers but it’s bad news for Rishi Sunak who made growing the economy a key part of the Conservative’s platform.
SKY NEWS
The UK economy has officially entered recession, figures show.
A recession is defined as two consecutive three-month periods where the economy contracts rather than grows.
A major measure of economic growth, gross domestic product (GDP) shrank 0.3% between October and December, the latest Office for National Statistics (ONS) data shows.
It’s a steeper-than-expected fall, as economists had forecast a 0.1% contraction.
It followed 0.1% of negative economic growth in the three months from July to September.
The data, however, is just an estimate and is subject to revision.
Figures are routinely revised as more information becomes available.
While previous recessions were long lasting – such as during the global financial crash of 2008 and 2009 – this one is likely to be mild and short-lived.
It could also prompt interest rate-setters at the Bank of England to bring down interest rates sooner, and reduce the cost of borrowing.
But the data will be bad news for Prime Minister Rishi Sunak and the Conservatives, who made growing the economy one of their five key pledges.
