UK economy unexpectedly contracts again as growth stalls ahead of Budget

"The UK economy unexpectedly contracted for a second consecutive month in October, underlining the fragility of growth as households and businesses reined in activity ahead of the Chancellor's Autumn Budget. Gross domestic product fell by 0.1 per cent in October, matching the decline seen in September, according to figures published by the Office for National Statistics. Economists had expected the economy to return to modest growth, forecasting an expansion of 0.1 per cent at the start of the fourth quarter."

"Construction was the weakest-performing sector, with activity down 0.6 per cent in October, while the dominant services sector contracted by 0.3 per cent, marking its worst performance in three months. Production output rose by 1.1 per cent as car manufacturing rebounded following the end of the JLR shutdown, with vehicle output jumping 9.5 per cent. Economists said the renewed slowdown reflected growing caution across the economy in the run-up to the Budget, alongside a cooling labour market and persistently high inflation."

UK gross domestic product contracted for a second consecutive month in October, falling 0.1 per cent and matching September's decline. Output on a rolling three-month basis also fell by 0.1 per cent, indicating weakening momentum. Construction activity was down 0.6 per cent, while services contracted by 0.3 per cent, the services sector's worst three-month performance. Production rose 1.1 per cent as vehicle output jumped 9.5 per cent after Jaguar Land Rover's shutdown ended. Businesses and households reined in activity amid uncertainty ahead of the Chancellor's Autumn Budget, with employers across multiple sectors delaying spending and some forecasters cutting growth forecasts.

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