The British economy failed to grow in April, dealing a blow to Rishi Sunak’s hopes of turning around the Tory party’s faltering election campaign.
According to data published by the Office for National Statistics (ONS) on Wednesday, gross domestic product (GDP) remained stable this month, after growing 0.4 percent in March.
This follows an estimated 0.6 percent growth in the first quarter of 2024, which lifted Britain out of a minor recession late last year.
It will also be just over a week before the next inflation figures are released and a decision is made by the Bank of England on interest rates.
The latest monthly figure will make gloomy reading for the prime minister, who has made economic growth one of the central pillars of his election campaign.
In March he said this year “will prove to be the year the economy bounces back” after the recession in 2023. Commenting on the figures, Chancellor Jeremy Hunt said: “There is more to do, but the economy is turning a corner. and inflation is back to normal.”
Labour’s shadow chancellor Rachel Reeves said economic growth figures show the economy has “come to a standstill”.
She said: “Rishi Sunak claims we have turned a corner but the economy has come to a standstill and there is no growth. These figures expose the damage done by fourteen years of conservative chaos.”
Economists had forecast GDP to be flat in April, helped by weaker-than-usual sales over the Easter period. Previous evidence suggested that wet weather had hit the retail and construction sectors particularly hard.
On a quarterly basis, real gross domestic product is estimated to have grown by 0.7 percent in the three months to April, compared with the three months to January 2024.
Commenting on the figures, TUC Secretary General Paul Nowak said: “Our economy is slowing down again. This has been the worst government for growth in modern times – and working people have paid the price.
“Real wages are still worth less than in 2008. Unemployment is rising at the fastest pace in the G7. And economic inactivity is at record levels.”
Paul Dales, chief UK economist at Capital Economics, said the stagnation in GDP figures “does not mean the economic recovery has died down”, but it is “hardly good news for the Prime Minister” so close to the election.
Luke Bartholomew, deputy chief economist at asset management giant Abrdn, said monthly GDP data can be volatile, and it is “important not to put too much stock in just one month of data and look at the broader trend over several months”.
He added: “And on that basis, the picture is emerging of a solid recovery from last year’s recession. This should continue as the year progresses as households benefit from strong real income growth in a context of falling inflation.”
Suren Thiru, economic director of the Institute of Chartered Accountants in England and Wales, said: ‘Despite these disappointing GDP figures, a rate cut in June appears unlikely, with the Bank of England likely to be a little wary of taking policy in the middle. change. of an election campaign.”
Nicholas Hyett, investment manager at Wealth Club, said: “The market had low expectations for the UK economy in April, which were met.
“In an election month, when every data release is closely watched, there is little here that can change the narrative.”