UK GDP stalls after beating forecasts in January

Industrial strike action was the primary root cause of stagnating growth in the UK over the month

13 April 2023

After beating forecasts in January (and even subject to a slight upward revision), UK GDP stalled in February showing zero growth. While technically true that this is better than what was feared some quarters ago, Chancellor Jeremy Hunt claiming that the “economic outlook is looking brighter” is quite some suspension of disbelief. Industrial strike action was the primary root cause of stagnating growth in the UK over the month. March saw continued striking and April sees no let-up so we are likely to continue to see the depressive effect on any growth. Inflation data will still be the driver for Bank of England policy which is more than likely past the peak, but a stagnating economy and expectations of its continued underperformance versus other developed market peers still puts UK risk assets in the unloved box for global allocators.