Even BEFORE the Covid crackdown, economy was still in limbo. GDP only grew 0.1% in October, fuelling fears of’stagflation.

  • The GDP rose just 0.1% in October, below the 0.4% analysts predicted. 
  • This weak number demonstrates the extent of global supply chain chaos and its impact on our lives.
  • Coronavirus curtains to fight Omicron could cause further damage to the economy

Rishi Sonak warned about “bumps in road” today, as grim numbers showed an economy that was stagnating even before the most recent coronavirus crackdown.

In October, GDP rose just 0.1%. This is lower than what analysts predicted. The UK plc remains 0.5% smaller than the pre-pandemic level.  

These weak numbers highlight the business pain caused by chaos in global supply chains, which has sent prices spiralling.

In an effort to stop Omicron variant activity, new measures were enacted.  

According to the Bank of England, inflation could rise above 5% by next year. This is more than twice its target. The poor performance of the GDP could mean that expectations for an increase in interest rates may be lowered.  

Grant Fitzner is the Chief Economist of the Office for National Statistics. He stated: “While October saw a slowdown in GDP growth, the UK’s health sector continued to grow strongly. Second-hand car sales as well as employment agencies have also contributed to the economic recovery. 

The October GDP growth was just 0.1% lower than what analysts expected. UK plc still stands at 0.5% below pre-pandemic levels

“Taken together, the dominant service sector achieved its pre-pandemic level in the last twenty months.

These gains were countered by a decline in restaurants after a strong season and decreased oil extraction and gasoline use. 

“Construction suffered its largest decline since April 2013 due to notable drops in housing and infrastructure construction, which was partly due to shortages of raw material.

According to ONS, the growth rate slowed in construction as it saw its worst drop in sales since April 2020. 

Chancellor Rishi Sunak said: ‘We’ve always acknowledged there could be bumps on our road to recovery, but the early actions we have taken, our ongoing £400bn economic support package and our vaccine programme mean we are well placed to keep our economy on track.

“We’re still seeing a faster recovery than anticipated, with more people on our payrolls and redundancies staying low.

The ONS said growth slowed as the construction sector notched up its largest drop in business since April 2020

According to the ONS, growth has slowed in construction as its biggest drop in revenue since April 2020.