UK GDP (gross domestic product) was flat in the three months to September, compared to the previous quarter, in which the three months to June saw a 0.2% expansion.
It mirrors the Bank of England’s expectations of a flat economy in 2024.
In output terms there was a 0.1% fall in the services sector, which offset a 0.1% increase in construction output and broadly flat output in the production sector.
Meanwhile, in expenditure terms, an increase in the volume of net trade was offset by falls in business investment, household spending and government consumption.
Month on month, the economy showed growth of 0.2% in September, following a 0.1% rise in August (having been revised down from 0.2%) and a 0.6% fall in July 2023, suggesting the UK has managed to avoid recession this year.
Expectations have been beat, however, of a 0.1% fall in GDP.
Ben Jones, CBI lead economist, said: “Forecasts for the UK economy have generally been edging down recently and the latest growth figures lived up to this gloomier view of near-term prospects.
“It’s clear that higher interest rates are starting to bite, and demand has become less resilient. CBI surveys agree with that overall picture and suggest that private sector activity is likely to stagnate in the coming months.
“The Bank of England’s latest forecasts make for particularly grim reading, with the economy expected to be flat next year – before growing at feeble rates in both 2025 and 2026. But action from the Chancellor in the Autumn Statement in a couple of weeks’ time could change that outlook.
“Unlocking business investment across the economy by making full expensing permanent could – according to CBI analysis – lead to a 2% increase to GDP by the end of the decade.”
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