- UK GDP grew 0.1% in November, the first growth since August
- Over the three months to November the economy failed to grow
- The service sector grew 0.1% with consumer facing services up 0.5% as pre-Christmas celebrations lured people to bars and restaurants
Danni Hewson, AJ Bell head of financial analysis, comments on the latest UK GDP figures:
“It’s hard to get excited about 0.1% growth, especially when the bigger picture is of an economy still stuck in the muck.
“Whilst November managed to deliver a tiny bit of growth as pubs and restaurants were filled with revellers determined to get into the Christmas spirit, if you zoom out to take in three months as a whole things have flatlined once again.
“At the start of last year it looked so promising as inflation cooled, businesses dusted themselves off and consumers dared to believe things would get better. And if you look hard you can see a few hardy green shoots, especially in the construction sector.
“But confidence since seems to have gone missing and that feeling is likely to persist into 2025, particularly if inflation insidiously creeps back up to uncomfortable levels which make it difficult for the Bank of England to justify rate cuts.
“The newest member of the MPC, Professor Alan Taylor, has called for pre-emptive measures, saying he’s more worried about the sluggish nature of the economy than rising prices.
“But rising prices can stymie growth, just look at warnings from housebuilders like Taylor Wimpey that suppliers are seeking to factor in impacts from the recent Budget which will increase build cost pressure. They also create that affordability conundrum which is why so many young people are stuck living back with their parents in a bid to try and save up for that home ownership dream.
“The government has said it will take time to turn the ship around and stimulate growth where there was very little before, but with business confidence so low it will have to work hard to deliver tangible results quickly.”
