GDP fell 0.3% in March, but grew by 0.1% for the first three months of the year and UK services sector led the decline, down 0.5%.
A very strong production sector grew by 0.7%, the strongest read since May 2021and construction was up by 0.2%.
Jonathan Moyes, Head of Investment Research, Wealth Club said, “It was another weak month of data for the UK, the dominant services sector diluted stronger performance from manufacturing and construction. A fall of 0.3% was lower than the 0.0% expected.
The UK appears to be stuck in limbo. This is the third broadly flat quarter for GDP in a row. Whilst the data suggests the UK is performing far better than most expected last year, it remains a challenge to reconcile how the UK economy can escape a recession after such a steep rise in interest rates.
Nonetheless, whilst strike action continued to affected the data, particularly for services, manufacturing and construction are clearly pockets of strength. If confidence surveys are to be believed, there has been a notable uptick in services in April, which may give a boost Q2 numbers.”