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Suren Thiru: UK economy to continue treading water despite April GDP rebound

Author: ICAEW

Published: 14 Jun 2023

Suren Thiru, Economics Director at ICAEW, responded to the UK GDP figures for April 2023, released by the Office for National Statistics today (Wednesday 14 June 2023):

“Although GDP rebounded in April, this reflects more the reversal of the squeeze on service sector activity from poor weather in March, than a meaningful improvement in our underlying growth trajectory.

“April’s upbeat reading should be followed by a notable decline in May GDP as the extra bank holiday for the Coronation and ongoing strike action will have stifled activity across much of the economy.

“While lower energy bills should boost incomes and support output over the summer, the financial squeeze from a higher tax burden and soaring borrowing costs means our economy may continue to tread water for some time.

“If the Bank of England continues to hike interest rates, as is likely next week, they risk reigniting recession fears by further increasing the financial fragility of households and businesses.”


Notes to editors:

Contact: ICAEW media office media.office@icaew.com, tom.mackintosh@icaew.com or 07866 853 841