The Bureau of National Statistics said Gross Domestic Product rose only 0.1% in February, up from a monthly growth rate of 0.8% in January, when the economy recovered from the coronavirus Omicron variant. The city’s economists had forecast a monthly growth rate of 0.3%. Overall, the economy was 1.5% higher than its pre-pandemic level in February. Raising questions about the strength of the economy before Russia’s invasion of Ukraine in late February, manufacturing plummeted as carmakers continued to struggle with spare parts amid a global supply chain downturn and shortages of vital components. Industry activity fell 0.4% month-on-month due to a 5.4% drop in transport equipment manufacturing and a 4.3% drop in computer, electronics and optical products, where microchip availability disrupted. production volume worldwide. Tourism has risen sharply following the easing of pandemic restrictions, which has led to an increase in holiday bookings in the UK and abroad, with a 33.1% increase for travel agents and tour operators. The hotel sector, which includes hotels, saw a 23% increase in activity as more people traveled to the UK, contributing to the first month of positive growth for hotels and campsites since August. However, growth in the services sector of the economy slowed amid a downturn in the health sector, largely reflecting the decline from high levels in the NHS testing and detection and vaccination programs in December and January, when the Omicron was at its peak. of. Graphic GDP The latest snap comes as business leaders and economists warn that Britain is likely to struggle for growth in the coming months as rising energy bills and the weekly cost of the weekly store reduce consumer power. “The news that the economy was not growing at all in February suggests that the economy was a little less dynamic in the first quarter than previously thought,” said Ruth Gregory, a senior UK economist at consulting firm Capital Economics. “[It] increases the risk of GDP shrinking in the coming months as the squeeze on real household incomes intensifies. “ Thomas Pugh, an economist at RSM UK accounting firm, said February may be the last month of growth for a while. “Rising fuel prices, falling business and consumer confidence and supply chain disruptions will start to be felt in March and will actually start in April, when energy prices have risen by 54%,” he said. . Some businesses said the Dudley, Eunice and Franklin storms during the month had disrupted trade, including in the construction industry, restaurants and bundles, hair salons and beauty salons, as well as amusement parks and resorts. Some companies reported positive impacts, such as fencing, torch sales and temporary off-grid power supply. Reflecting the blow to the construction industry as facilities were forced to close and cranes were idle amid the disruption, production in the construction sector fell by 0.1% per month. Suren Thiru, chief financial officer at the British Chamber of Commerce, said the government needed to provide more financial support to companies and businesses to cope with rising cost pressures. “The February slowdown is likely to be the beginning of a prolonged period of significantly weaker growth as rising inflation, rising energy bills and higher taxes increasingly undermine key production levers in the UK, including consumer and consumer spending. investment, “he said. Subscribe to the daily Business Today email or follow the Guardian Business on Twitter at @BusinessDesk He comes amid growing pressure on Chancellor Rishi Sunak over his wife’s tax affairs and criticism of his spring statement last month for inaction to help those most in need during the cost-of-life emergency. Sunak acknowledged that the economy was facing uncertainty, although he claimed that 22 22 billion in living costs had been allocated to families this year, as well as 1. 1,000 tax cuts for half a million small businesses. “Russia’s invasion of Ukraine creates additional economic uncertainty here in the United Kingdom, but it is right to respond strongly to Putin’s unprovoked invasion,” he said.
