Disappointing Economic Growth In February Suggests The Economy Is Still Fragile

The monthly GDP figures for February 2024, showed growth of 0.1%.


Dr Roger Barker, Director of Policy at the Institute of Directors, said:

“The economy barely grew in February, which suggests that the economy is still in a fragile state. After a strong start to the year, the consumer-facing parts of the economy – particularly accommodation and food services – took a backward step. Construction was also surprisingly weak, although there were encouraging signs of revival in production and manufacturing output.

"It appears that the UK’s ascent out of the mild technical recession of last year is a relatively shallow one. Although the latest figures suggest that the UK is likely to generate positive economic growth in the first quarter, there are few signs of a strong economic rebound. The assertion that the UK economy has decisively turned the corner, as recently asserted by the Prime Minister, is still yet to find confirmation in the data.

"The Bank of England’s Monetary Policy Committee is next due to meet on the 9 May. The weakness of February’s GDP figures will give them food for thought as they seek to determine the future course of UK interest rates. Based on today’s figures, the case for cutting Base Rate sooner rather than later is a relatively strong one.”


Ben Jones, CBI Lead Economist, said:

“With the damp and dismal weather hitting retail and other sectors, it’s not surprising to see activity was broadly flat in February. But lower inflation is easing pressure on household incomes and spending, and the economy still seems to be on course to exit its mild recession in the first quarter.

“While growth was probably fairly modest over the first quarter, the outlook is improving with our business surveys showing growth expectations for the second quarter at their strongest for almost two years.

“But we need to get some momentum going in economy without undoing hard work to bring down inflation. In this General Election year, it’s crucial parties of all stripes focus on structural challenges facing economy – like poor productivity and labour market pressure.

“What firms across all regions, nations and sectors tell us they need to drive sustainable growth, is stability and a long-term economic vision - which in turn will deliver prosperity to businesses and households alike.”