PwC comments on latest ONS March 2024 GDP data

Commenting on the latest ONS GDP data, Barret Kupelian, Chief Economist at PwC, says:

“The UK economy grew by 0.2% month-on-month in January this year, consistent with consensus views, following a fall the month prior. 

“This is in line with the post-pandemic trend of the UK suffering from sluggish economic activity-- one which alternates between a growing economy one month followed by a shrinking economy next (see chart).  

“It is too soon to say whether we have broken away from this doom loop, however, there are some tentative signs to be more positive about the near term outlook. 

• First, leading indicators such as the Purchasing Managers Index (PMI) suggest an uptick in private sector activity in the near-term. 
• Second, the uplift in the National Living Wage and uprating of benefits should help alleviate pressure on vulnerable members of society. 
• Third, the prospects of lower policy interest rates should help businesses and households re-adjust their spending decisions. 

“The missing ingredient to lock in sustainable economic growth rates--that of an Industrial (and Services sector) Strategy is still missing and is an area that should be addressed sooner rather than later.”