Proactive Investors - The economy shrank by more than expected in October as the UK continues to battle to avoid a recession.
Figures from the Office for National Statistics (ONS) showed that GDP fell 0.3% in October following growth of 0.2% in September, worse than the 0.1% fall predicted by economists.
Over the three months to October, the ONS said GDP showed no growth compared with the three months to July 2023.
Services output fell by 0.2% in October, driven by a fall in information technology and communication, and was the main contributor to the fall in growth in GDP, following growth of 0.2% in September.
Production output fell by 0.8% in October, driven by widespread declines in manufacturing, after showing no growth in September.
The construction sector fell by 0.5% in October after growth of 0.4% in September.
Darren Morgan, director of Economic Statistics at the ONS, said: “October... saw contractions across all three main sectors.
“Services were the biggest driver of the fall with drops in IT, legal firms and film production - which fell back after a couple of strong months.”
“These were also compounded by widespread falls in manufacturing and construction, which fell partly due to the poor weather.”
Samuel Tombs at Pantheon Macroeconomics noted October’s drop adds to the “growing list of recent downside data surprises, but we still doubt that the [Monetary Policy Committee] will change its tune and signal its willingness to cut Bank Rate next year as soon as this week’s meeting.”
“Worryingly, the decline in GDP was broad based, with industrial production falling by 0.8%, construction output dropping by 0.5% and services output falling by 0.2%,” he pointed out.