LONDON — The British economy failed to grow in April, official figures showed on Wednesday, a blow to Prime Minister Rishi Sunak, who has made a return to growth and a generally calmer economic environment a central pillar of the UK election campaign. Conservative Party has made.
According to the Office for National Statistics, the wet weather dampened consumer spending and the construction sector during the month. The flat monthly value came after a 0.6% increase during the first quarter of the year Sunak has made a lot of money during the campaign after a period of moderate growth.
While monthly figures are vulnerable to short-term factors, the flat reading is likely to be used by Conservative opponents in the run-up to the July 4 election.
While the head of the Treasury, Jeremy Hunt, insisted the “economy is turning a corner”, his Labor Party counterpart, Rachel Reeves, said the “economy has come to a standstill”.
The latest growth figures come a week before the next round of inflation data and the Bank of England's next interest rate decision.
Hopes within the Conservative Party that the bank would cut its key interest rate from a 16-year high of 5.25% have faded after inflation failed to fall as sharply in April as hoped. Although annual inflation has fallen to 2.3%, it remains slightly above the bank's target and is expected to rise slightly in the coming months.
High interest rates – which cool the economy by making it more expensive to borrow – have helped ease inflation, but have also weighed on the UK economy.
“A rate cut in June seems unlikely as the Bank of England is likely to be a little reluctant to change policy in the middle of a general election campaign,” said Suren Thiru, economics director at the Institute of Chartered Accountants in England and Wales.
Sunak promised on Tuesday to cut taxes and reduce immigration into the US The Conservative Party manifesto for the government if he is re-elected. Labour, which is leading in the opinion polls, will publish its manifesto on Thursday.
