The UK has become stagnation nation with gross domestic product per head falling for seven consecutive quarters. It puts the government in an even tighter predicament as contraction in the third and fourth quarters confirmed that the economy is in recession, destroying one of Prime Minister Rishi Sunak’s five tests. The March 6 budget from Chancellor of the Exchequer Jeremy Hunt may introduce public-sector spending reductions to fund tax cuts, but with limited fiscal room for maneuver, he — and the economy — could do with some help from the monetary side of the equation.

The message from this week’s economic data is pretty gloomy. GDP shrank by 0.3% in the final three months of last year, after a 0.1% contraction in the previous quarter. For all of 2023, the economy grew just 0.1%; more worrying is 1% compression in the private sector in the final nine months of last year. There’s little sign of respite with ongoing public-sector strikes, and Bloomberg Economics expects a further 0.1% contractionBloomberg Terminal in the current quarter.

QOSHE - Stagnating UK Economy Is Crying Out For Rate Cuts - Marcus Ashworth
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Stagnating UK Economy Is Crying Out For Rate Cuts

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16.02.2024

The UK has become stagnation nation with gross domestic product per head falling for seven consecutive quarters. It puts the government in an even tighter predicament as contraction in the third and fourth quarters confirmed that the economy is in recession, destroying one........

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