UK GDP shows no growth in February 2023, according to the latest estimates released by the Office for National Statistics.
Despite growth of 0.4% in January, revised up from 0.3%, there was no growth in February as falls in services and production were offset by growth in construction. Looking at the broader picture, GDP grew by 0.1% in the three months to February 2023.
The services sector fell by 0.1% in February 2023, after growing by 0.7% in January 2023, revised up from 0.5%. Education and public administration and defence contributed the most to the fall in services output due to industrial action in both sectors.
Output in consumer-facing services grew by 0.4% in February 2023, driven by growth in retail trade, except for motor vehicles and motorcycles.
Meanwhile, production output fell by 0.2% in February 2023, following a fall of 0.5% in January 2023, revised from a fall of 0.3%. However, the construction sector grew by 2.4% in February 2023, after falling by 1.7% in January 2023.
These figures come as the International Monetary Fund (IMF) forecasts a downturn in the UK economy this year, with the country expected to have the worst growth in the G7 group of advanced nations in 2023 and 2024.
The IMF now expects the UK economy to shrink by 0.3% in 2023 and grow by 1% next year.
Despite the IMF’s latest predictions, the UK government remains optimistic about the country’s economic outlook. Health Secretary Jeremy Hunt has insisted that the country is on track to avoid recession, even though the IMF’s forecasts are worse than expected.
The IMF marginally upgraded its forecast for UK GDP this year and next in its World Economic Output report earlier this week.
Barclays SME Barometer reported in February that more SMEs were optimistic about their 2023 prospects, with 41 per cent of UK small and medium-sized businesses feeling upbeat about the prospects of their own business, the highest level in 9 months. Some 55% of SMEs surveyed expected revenue growth this quarter compared to the same period last year.