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Weak return to growth makes November rate rise less likely, ICAEW says

Author: ICAEW

Published: 12 Oct 2023

Suren Thiru, Economics Director at ICAEW, responds to the latest UK GDP figures for August 2023, released by the Office for National Statistics today (Thursday 12 October 2023).

“This disappointingly weak return to growth points to an economy fraying at the edges as inflation and higher interest rates hinder businesses and consumers. 

“August’s GDP increase largely reflected the reversal of the squeeze on July’s activity in services from poor weather and strike action.

“With inflation, higher taxes and the lagged impact of previous interest rate rises weighing heavily on consumer demand and business activity, the UK is likely to remain uncomfortably close to recession well into next year.

“These underwhelming GDP figures provide further evidence that higher borrowing costs are hurting the economy, making an interest rate rise in November less likely.”


Notes to editors:

Contact: ICAEW media office media.office@icaew.com, tom.mackintosh@icaew.com