"UK Economy Grinds to Halt in July"

UK Economy Stalls: Zero Growth in July Amid Manufacturing Slump The UK economy experienced zero growth in July, marking the second consecutive month of stagnation, according to data released by the Office for National Statistics (ONS). The news comes as a blow to the government's efforts to boost economic growth ahead of Chancellor Rachel Reeves' Budget announcement on November 26. The ONS reported that manufacturing output declined by 0.8% in July, the largest contraction in over a year, which was offset by expansion in the service sector. However, when looking at the bigger picture, the economy has slowed down over the past quarter, with a 0.2% increase in the three months to July. The data suggests that the UK's economic recovery is losing momentum, raising concerns among economists and policymakers. "The fact that the economy has stalled for two consecutive months is a worrying sign," said Dr. Emma Taylor, an economist at the Centre for Economic Performance. "We need to see a pick-up in growth to meet the government's targets." According to the ONS, monthly figures are volatile, and the agency will now focus on growth over a rolling three-month period. This shift in focus is seen as a way to smooth out the fluctuations in economic data and provide a more accurate picture of the economy. The government is under mounting pressure to deliver on its key priority of boosting economic growth ahead of the Budget announcement. Chancellor Reeves is expected to outline tax and spending plans, which may include potential tax hikes. However, experts warn that increasing taxes could have unintended consequences on the economy. "The government needs to be careful not to overburden businesses with more taxes," said Dr. Taylor. "We need to see a balanced approach that supports growth while also addressing the country's fiscal challenges." The UK economy has been facing headwinds in recent months, including a decline in consumer spending and a slowdown in business investment. The government's ability to stimulate growth will be closely watched ahead of the Budget announcement. In the meantime, the ONS will continue to monitor economic data and provide regular updates on the state of the economy. As the UK heads into the final stretch before the Budget, all eyes are on Chancellor Reeves and her team to deliver a plan that will boost growth and support businesses. Sources: - Office for National Statistics (ONS) - Dr. Emma Taylor, economist at the Centre for Economic Performance This story was compiled from reports by BBC Business and BBC Business.