You would imagine it was not the sort of Christmas present the ruling Conservatives would have wanted.
Recession alarm bells are ringing for the UK economy after official figures this morning revealed that gross domestic product had fallen by 0.1% in the third quarter.
The Office for National Statistics revised the third-quarter figures, having previously estimated the economy had stagnated in the three months to September.
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A further fall in GDP in the current quarter to the end of this month would mean the UK would be in recession.
And the fourth quarter did not get off to a good start, with the ONS having published data on December 13 showing that UK GDP fell by 0.3% month-on-month in October.
The bad news for Chancellor Jeremy Hunt and his senior Conservative colleagues in today’s ONS figures went beyond the downward revision for the third quarter.
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The ONS, in today’s figures, now calculates the UK economy stagnated during the second quarter, having previously estimated that GDP grew by 0.2% during this period.
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Martin Beck, chief economic adviser to the EY ITEM Club think-tank, said: “October's decline in GDP, the growing drag from past rises in interest rates, and industrial action holding back activity in some sectors mean the economy in Q4 is likely to flatline at best, with a technical recession a serious possibility.”
Danni Hewson, head of financial analysis at stockbroker AJ Bell, said: “The Chancellor might believe that 2024 will be the year the UK throws off its ‘pessimism and declinism’ but it might also be a year that starts in a recession.
“Revised figures paint a gloomier picture of the country’s economy than we’d been led to believe, as a cost of living crisis and rising interest rates have dented confidence.”
Thomas Pugh, economist at accountancy firm RSM UK, said: ‘The downward revision for Q3, combined with the weakness in October, means there is a significant risk that the economy could fall into recession at the end of the year. However, we still think the economy will manage to eke out some growth in Q4, meaning a recession should be avoided.”
He added: “The economy will continue to stagnate through most of 2024, though, only returning to sustainable growth in the second half of the year.”
Even before today’s GDP figures, it was plain the UK economy was in grim shape and that the outlook was bleak.
The big question now is whether or not the UK falls into recession.
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