UK economy slipped into technical recession at the end of 2023

LONDON — The U.K. economy slipped into a technical recession in the final quarter of last year, initial figures showed Thursday.

The Office for National Statistics said U.K. gross domestic product shrank by 0.3% in the final three months of the year, notching the second consecutive quarterly decline.

Though there is no official definition of a recession, two straight quarters of negative growth is widely considered a technical recession.

Economists polled by Reuters had produced a consensus forecast of -0.1% for the October to December period.

All three main sectors of the economy contracted in the fourth quarter, with the ONS noting declines of 0.2% in services, 1% in production and 1.3% in construction output.

Across the whole of 2023, the British GDP is estimated to have increased by just 0.1%, compared to 2022. For the month of December, output shrank by 0.1%.

Inflation has come down markedly in the U.K., but remains well above that of the country’s economic peers and the Bank of England’s 2% target, squeezing household finances. The headline consumer price index reading came in at 4% year-on-year in January.

This is a breaking news story and will be updated shortly.