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UK Economy Grew Slower Than Expected In July

September 12, 2022

The UK economy grew by 0.2% in July, according to official data, following a sharp drop in the previous month.

The Office for National Statistics said the services sector was the biggest contributor to growth, helped by the UK hosting the Women's Euro Championship.

However, while the economy expanded in July, the growth was slower than analysts had expected.

Gross domestic product (GDP) fell in June due to the extra bank holiday for the Queen's Jubilee.

GDP - which measures all the goods and services produced by the UK - fell by 0.6% in June because of two fewer working days.

Analysts have said the bank holiday for Queen Elizabeth's state funeral on 19 September, as well as the 10 days of national mourning, could impact economic growth and push the UK into recession sooner than expected.

Last month, the Bank of England said it expected the UK to fall into recession at the end of this year.

A recession is defined as two consecutive quarters, or three-month periods, of shrinking output. Between April and June, the economy contracted by 0.1% compared with the previous quarter.

A bank holiday impacts growth because there are fewer people at work. Philip Shaw, chief economist at Investec, told the Times: "It is quite possible that you get a contraction over the month as a whole, which results in the economy getting smaller over the quarter."















Source: BBC
Image source: Pixabay