UK economy shrinks in August, raising recession risk
Official data shows the UK economy unexpectedly shrank in August for the first time in two months.
The surprise 0.3% drop came after the economy grew 0.1% in July, according to the Office of National Statistics, raising the risk of a recession.
It had been predicted that economic growth would stall as businesses and households face soaring costs.
The Bank of England has issued a warning that the UK will fall into recession towards the end of the year.
The drop in the monthly figure was driven by a sharp decline in manufacturers and maintenance work which slowed down the oil and gas sector, the ONS said.
“The economy shrank in August with both production and services falling back, and with a small downward revision to July’s growth the economy contracted in the last three months as a whole,” ONS Chief Economist Grant Fitzner said.
Mr Fitzner added that lots of other customer-facing businesses like retail, hairdressers and hotels were “faring relatively poorly”.