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Economists predict that the UK recession will be the deepest among major advanced economies in 2023
Britain’s economy shrank more than previously estimated in the third quarter, placing it at the bottom of the group of seven leading advanced economies.
On Thursday (22), economic output showed a 0.3% drop from the previous quarter, against an estimated 0.2% drop, the National Bureau of Statistics said.
The data put the UK at the bottom of the G7 in terms of quarterly growth, although readings were subdued due to a bank holiday for Queen Elizabeth II’s funeral.
Business investment fell 2.5% in the quarter, compared with a 0.5% decline in the previous first estimate.
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“Looking ahead, the UK is likely to continue to perform well. We expect the country to experience a very deep recession in 2023 due to the severity of headwinds from monetary and fiscal policy,” said Gabriella Dickens, economist at Pantheon Macroeconomics.
The agency said British economic output in the third quarter was 0.8% lower than the level at the end of 2019, down from the previous estimate of 0.4% and in contrast to other G7 countries that have recovered.
While the services sector expanded 0.1% in the quarter, declines in manufacturing and construction dragged down the numbers.
Most economists polled by Reuters predicted the economy would contract again in the current quarter, which is generally considered a recession.
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