November 12, 2021

UK Economy Confused, Here's Details Why Market Players Are Beginning to Hesitate!

 The UK's economic recovery from the Covid-19 pandemic is increasingly lagging behind other developed countries in the third quarter, based on official data released briefly earlier. At the same time, the UK is also faced with the dilemma of increasing utility rates.

Crude in-country output (KDNK) increased by 1.3% which is the weakest growth rate since the UK imposed confinement measures in early 2021. A Reuters review of economists and the Bank of England (BoE) instead forecast a rise of 1.5%.

The Office of Statistics says the UK economy remains 2.1% smaller than in 2019 and less than G7 countries such as Germany, Italy and France.

On the other hand, the United States has succeeded in recording much greater economic growth than before the crisis. Canada and Japan, another G7 expert, have yet to report third quarter growth data but have recovered more growth in the second quarter than the UK recorded in the third.

Data on Thursday showed Britain's KDNK increased by 0.6% in September which was stronger than the 0.4% forecast but the budget for the previous month was checked lower.

The BoE last week opted to maintain the benefit rate. Plus, recent economic growth has been weaker than expected, so the labor market will be a major concern.

So it's not daily that some analysts doubt the Bank of England will increase the benefit rate by more than 0.50% next year.

Separate data show Britain's trade deficit in goods increased by £9 billion in the third quarter to £42.3 billion, driven by increased imports from EU and non-EU countries if exports fell mainly to non-EU countries.