UK's economy experienced a recession in the second half of 2023, presenting a formidable challenge for Prime Minister Rishi Sunak, who pledged to stimulate growth in preparation for the upcoming 2024 election, Reuters reported on Thursday. According to the Office for National Statistics (ONS), the gross domestic product (GDP) contracted by a more severe-than-anticipated 0.3 per cent during the fourth quarter of 2023, following a 0.1 per cent decline between July and September. The ONS noted that this fourth-quarter decline in GDP marked the most significant contraction since the first quarter of 2021. The Bank of England has projected a modest recovery in the economy for 2024, but businesses are concerned about the obstacles they face. Finance Minister Jeremy Hunt has underscored the importance of adhering to the strategy of reducing taxes on labour and businesses to fortify the economy. However, media reports have suggested that he is contemplating reducing public expenditures to finance tax cuts in the forthcoming budget prior to the election. The ONS revealed that economic output decreased by 0.1 per cent in December, following a 0.2 percent growth in November. The decline in GDP was mainly driven by the manufacturing, construction, and wholesale sectors.
