Setback for Reeves as economy shrinks in September

THE UK’s economy contracted in September, with growth slowing significantly over the third quarter, posing an early challenge to Rachel Reeves’ plans to boost economic performance.

Data from the Office for National Statistics (ONS) on Friday showed a 0.1 per cent decline in GDP for September, driven by flatlining services and drops in manufacturing and construction.

Over the July-September period, GDP grew by just 0.1 per cent, down from 0.5 per cent in the second quarter. This fell short of the 0.2 per cent growth predicted by both the Bank of England and economists polled by Reuters, as the economy lost momentum following a strong first half of the year.

Chancellor Reeves responded to the figures, saying: “Improving economic growth is at the heart of everything I am seeking to achieve, which is why I am not satisfied with these numbers. Now we are going to deliver growth through investment and reform.”

On Thursday, Reeves outlined plans to overhaul regulations in the financial sector, which she described as essential for economic growth.

Friday’s data showed a 1.2 per cent rise in business investment for the quarter, marking growth in this area for four consecutive quarters. Sterling and British government bonds showed little reaction to the figures Read More…..