UK recession risks linger despite brighter growth data

LONDON: The UK economy performed slightly better than thought in the final quarter of last year, revised data showed Friday, but analysts warned of recession risks as inflation remains sky high.

The Office for National Statistics (ONS) said the economy grew 0.1 percent in the October-December period after an initial estimate showing flat output.

Either way, the UK narrowly avoided falling into recession at the end of 2022 despite a cost-of-living crisis.

“The economy performed a little more strongly… than previously estimated, with later data showing telecommunications, construction and manufacturing all faring better than initially thought,” noted ONS director of economic statistics, Darren Morgan.

He added that households saved more in the last quarter, with finances boosted by government support to pay sky-high energy bills.

“Meanwhile, the UK’s balance of payments deficit with the rest of the world narrowed, driven by increased foreign earnings by UK companies, particularly in the energy sector,” he added.

Oil and gas prices soared last year as supplies tightened following the invasion of Ukraine by key energy producer Russia.

That largely contributed to inflation soaring worldwide in 2022, with UK consumer prices reaching a four-decade high above 11 percent.

After dipping at the end of last year and start of 2023, British inflation rose back to 10.4 percent in February.