By Ed Frankl
The U.K. economy grew marginally in the first quarter of 2023, matching previous estimates, as a cost-of-living crisis impacted by high inflation and rising interest rates weighed on economic activity.
Gross domestic product grew 0.1% from January to March compared with the previous three-month period, the same as the fourth quarter of 2022 and in preliminary estimates, according to data from the Office for National Statistics released Friday.
Economists polled by the Wall Street Journal also expected growth of 0.1%.
It meant quarterly GDP in the first quarter was 0.5% smaller than at its prepandemic level in the final three months of 2019, the ONS said. Among G-7 nations, only Germany also trails its prepandemic level.
Since the end of the first quarter, ONS data already said the U.K. economy grew 0.2% on month in April. GDP is expected to grow 0.2% in 2023, according to a poll of economists by FactSet. B
But economic activity is expected to be hampered further after the Bank of England raised rates to 5% at its most recent meeting, in an attempt to put a lid on inflation that runs higher than many peer nations.
In a separate release, the ONS said the U.K.’s current-account deficit widened to 10.8 billion pounds ($13.6 billion) in the first quarter from a GBP2.5 billion deficit in the fourth quarter of 2022.
Write to Ed Frankl at [email protected]
