The UK is not currently in recession despite earlier predictions to the contrary, but the economy has continued to slow, according to newly released official data.
The Office for National Statistics (ONS) said on Sept. 30 that the UK’s GDP grew by 0.2 percent over the three months to June, after revising a previously estimated decline.
The statistics body had previously predicted a 0.1 percent fall in GDP for the quarter.
ONS Chief Economist Grant Fitzner said: “These improved figures show the economy grew in the second quarter, revised up from a small fall.
“They also show that, while household savings fell back in the most recent quarter, households saved more than we previously estimated during and after the pandemic.”
The Bank of England said earlier this month that the UK was likely to currently be in recession as it forecast another decline of 0.2 percent for the three months to September.
A technical recession is when the economy witnesses two consecutive quarters of decline.
Subdued Outlook
However, the ONS said there has been a slowing in the UK economy in the second quarter compared with the first quarter.There has been a slowdown in some services industries, reflecting the effects of squeezed household incomes and labour and product shortages in some industries, it said.
Consumer confidence has fallen to an historic low and real household disposable income has now fallen for four consecutive quarters, reflecting the effects of higher price inflation, the ONS added.
More timely figures show that the volume of retail sales continued to decline in August 2022.
The latest independent forecasts for the UK economy expect a slowdown for later this year, while there is a subdued outlook for next year.
According to the new figures, despite growth in the latest quarter, the economy as a whole is smaller than previously predicted.
Economists said they believe overall GDP is now 0.2 percent below pre-pandemic levels, having previously said they thought it was 0.6 percent bigger than before COVID-19 struck.
“Overall, these new figures show that the economy was slightly smaller than our previous estimate, and in the second quarter was a little below its level when the pandemic struck, as the economy shrank more than we first estimated during the early months of the pandemic but rebounded more strongly in the latter half of 2021,” said Fitzner, the ONS economist.
