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UK economy stagnates during final three months of 2022

The British economy has stagnated in the final three months of last year under the weight of a cost-of-living crisis

Danica Kirka
Friday 10 February 2023 04:43 EST
Britain Economy
Britain Economy (Copyright 2023 The Associated Press. All rights reserved)

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The British economy stagnated in the final three months of last year, offering little help for 7 million households expected to struggle to pay food and energy bills.

The Office for National Statistics said Friday there was no growth in gross domestic product during the fourth quarter of 2022. However, the economy dodged a second consecutive quarter of contraction.

Two straight quarters of economic decline is one definition of a recession. Britain doesn’t have an independent body that declares recessions like in the U.S. and Europe, which use other data such as unemployment in their assessments.

But the reading is anything but optimistic. The National Institute of Economic and Social Research warned earlier this week that 2023 will “certainly feel like a recession,” as persistent inflation and rising taxes squeeze household incomes.

The institute projects that one in four UK households — some seven million families — won’t be able pay food and energy bills from their post-tax income in the 2023-24 financial year, up from around one in five in 2022-23.

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