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UK economy flatlines in fresh blow to Rishi Sunak’s election hopes

The economy flatlined due to wet weather hitting retail sales over the Easter period, following growth of 0.4% in March

Wet weather over the Easter period is believed to have knocked retail sales and construction particularly hard (EPA)

In March he said this year will be “prove to be the year that the economy bounces back” after the downturn in 2023. Responding to the figures, chancellor Jeremy Hunt said: “There is more to do, but the economy is turning a corner and inflation is back down to normal.”

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Labour’s shadow chancellor Rachel Reeves said the economic growth figures showed the economy has “stalled”.

She said: “Rishi Sunak claims we have turned a corner, but the economy has stalled and there is no growth. These figures expose the damage done after 14 years of Conservative chaos.”

Economists had predicted that GDP would be flat in April, held down by weaker-than-usual sales over the Easter period. Earlier evidence had suggested wet weather knocked retail and construction output particularly hard.

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On a quarterly basis, real gross domestic product is estimated to have grown by 0.7 per cent in the three months to April, compared with the three months to January 2024.

Commenting on the figures, TUC General Secretary Paul Nowak said: “Our economy is slowing yet again. This has been the worst government for growth in modern times – and working people have paid the price.

“Real wages are still worth less than 2008. Unemployment is rising at the fastest rate in the G7. And economic inactivity is at record levels.”

Paul Dales, UK chief economist at Capital Economics, said the stagnation in GDP figures “doesn’t mean the economic recovery has been extinguished” but that it’s “hardly great news for the prime minister” so close to the election.

Luke Bartholomew, deputy chief economist at asset management giant abrdn, said monthly GDP data can be volatile, and that it is “important not to put too much stead in just one month of data and look at the broader trend across several months”.

He added: “And on that measure, a picture of solid recovery from last year’s recession emerges. This should continue as the year progresses as households benefit from strong real income growth amid falling inflation.”