UK economic growth slows down as Iran war pushes up energy prices
Economic growth slowed in the second quarter of the year, as the disruption unleashed by the Iran war began to take its toll, official figures
Economic growth slowed in the second quarter of the year, as the disruption unleashed by the Iran war began to take its toll, official figures show. The Office for Statistics (ONS) said GDP expanded by 0.4% in the three months to June, down from 0.6% in the first quarter, in line with City economistsā expectations. The UK economy had been more resilient in the face of the ongoing Middle East conflict than some analysts feared.
But the latest data suggests continued high energy prices are starting to weigh on growth. The news comes as the new chancellor, John Healey, prepares to present his first budget on 28 October. With energy prices remaining high, he could come under pressure to offer additional support to households this winter. Andy Burnham announced a VAT cut for electricity bills last month, but told the BBC on Wednesday that he would like to go further.
āI can accept criticism that this isnāt enough, because I wouldnāt say itās enough,ā he said. skip past newsletter promotion Free newsletter | Every weekday Sign up to Business Today Get set for the working day ā we'll point you to all the business news and analysis you need every morning Enter your email Sign up after newsletter promotion Inflation figures for July will be published next week and are expected to show a higher reading than Juneās 2.6%, reflecting rising utility bills.
Sustained high inflation will increase pressure on the Bank of England to raise interest rates.
The BriefWire