Judul : Shops Struggle, Borrowing Soars as UK Economy Stalls Before Budget
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Shops Struggle, Borrowing Soars as UK Economy Stalls Before Budget
The UK's economy has stagnated, with borrowing exceeding expectations and consumers avoiding high street shops, as data reveals a bleak setting for next week's events.Budget.
A highly monitored business survey indicated that private sector expansion has nearly come to a halt this month, partially due to uncertainty regarding the Chancellor's upcoming announcement.
The monthly purchasing managers' index (PMI) survey reported a value of 50.5 for November – on a scale where 50 represents the neutral point distinguishing expansion from decline.
And government borrowing so far this financial year has been £10 billion more than anticipated, the Office for National Statistics (ONS) reported.
That further complicates Rachel Reeves' tries to fix the public finances.
Separate statistics from ONS indicated that retail sales declined during the previous month – highlighting the worried attitude of consumers concerned about a financial impact from the Budget.
Yesterday, the US investment bank Goldman Sachs cautioned that Ms. Reeves is expected to unveil tax hikes amounting to £30 billion, which could further hinder economic growth.
A collection of poor figures highlights the most recent signs of the worsening conditions for businesses and consumers in Britain under Labour.
They heighten concerns that Wednesday's Budget has further depleted an economy already weakened by significant tax increases she implemented last year. Inflation continues to be persistently high at 3.6 percent, the highest among G7 economies.
Conservative business representative Andrew Griffith stated: "We are witnessing the effects of Reeves' Budget, creating a sense of uncertainty that is weighing down the economy. It didn't have to turn out like this. She has managed to harm business even before she speaks."
The PMI data, gathered by the financial company S&P Global Market Intelligence, showed an economy that is still struggling, even though Labour has stated that growth is their main priority.
Chris Williamson, the company's chief business economist, stated: "EGrowth has come to a standstill, layoffs have increased, and business confidence has declined."
The most recent data aligns with a zero percent increase in gross domestic product for November and a 0.1 percent rise in the fourth quarter, he mentioned.
This comes after recent official data indicated a growth of only 0.1 percent in the third quarter.
Mr. Williamson stated, "Some of this gloom has been attributed to delayed spending choices before the Autumn Budget, but there's a genuine possibility this delay could lead to a decline."
A decline in confidence regarding the upcoming year indicates increasing worries that business conditions will stay challenging in the next few months, primarily connected to rumors that additional measures to curb demand will be included in the Budget.
The borrowing for the first seven months of the financial year, starting from April, stands at £116.8 billion. This is £9.9 billion more than what was predicted in March.
Read more- Is Britain's business confidence declining sharply following Rachel Reeves' October Budget tax increase?
- Is the British economy experiencing a slowdown due to Rachel Reeves' tax policies, resulting in significant declines in growth rates and reduced business investments?
- Is the UK's economy nearing a crisis as concerns over stagflation grow following the tough measures outlined in Rachel Reeves' recent budget?
- What has caused a significant decline in UK business confidence following Rachel Reeves' Budget?
- Could Rachel Reeves' contentious 'major tax' Budget lead to trouble for the UK economy, causing a recession with poor growth numbers and increasing concerns?
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