LONDON (Reuters) – British economic output failed to grow in the third quarter, official figures showed, adding to signs of a slowdown at the start of British Prime Minister Keir Starmer's government.
The Office for National Statistics on Monday lowered its estimate for the change in gross domestic product to 0.0% in the July-September period, down from the previous estimate of 0.1%.
The Office for National Statistics also lowered its second-quarter growth estimate to 0.4% from the previous 0.5%.
Starmer and his finance minister, Rachel Reeves, took office in early July, warning of the dire economic state before announcing tax rises on employers in the October 30 Budget.
Last week, the Bank of England predicted that the economy would show zero growth in the fourth quarter. But it kept borrowing costs on hold because of the risks still posed by inflation.
Reeves said GDP data released on Monday showed she faced a major challenge “after 15 years of neglect” under previous Conservative-led governments. She said her budget would create sustainable growth in the long term.
The Office for National Statistics said there was no growth in the services sector in the third quarter. The 0.7% increase in construction was offset by a 0.4% decrease in production.
It added that pubs and restaurants, as well as law and advertising firms, were among the weakest sectors in the three months to the end of September.
The data also showed no growth in living standards and a decline in household savings, although they remained high by historical standards.
The Office for National Statistics said Britain's current account deficit shrank to £18.1 billion in the third quarter from £24 billion in the April-June period.
A Reuters poll of economists indicated a deficit of 22.5 billion pounds.
There was little change in the pound sterling after the Office for National Statistics data.
