A screen shows the value of the Pound Sterling against the U.S. Dollar | Daniel Sorabji/AFP via Getty Images
UK faces pressure over Brexit stance as economy dips
Statistics show the country is on the edge of a recession.
By Matei Rosca
Updated 8/9/19, 2:28 PM CET
LONDON — The British government faces fresh pressure to contain the economic fallout of a possible no-deal Brexit after statistics Friday showed the country on the edge of a recession.
The U.K. economy contracted by 0.2 percent from April through June, its first quarterly decline since 2012, the Office for National Statistics said. Economists typically define a recession as two contractions in a row.
Chancellor of the Exchequer Sajid Javid played down the figures in a statement, pointing to “growth slowing in many countries.” He restated government policy that the UK would leave the EU at the end of October with an agreement or not.
But analysts said not all of the trend was down to trade tensions and more general weakness across the region.
“Today’s negative growth figures reflect a combination of Brexit uncertainty and global economic slowdown, with both challenges set to persist over the near term,” said Matthew Whittaker, deputy chief executive at the Resolution Foundation, a think tank. “That doesn’t mean we’re necessarily heading for recession, but the risk is certainly heightened right now.”
Capital Economics said in a note, “The U.K. should avoid a recession … unless there’s a no deal Brexit.”
The statistics point to weak manufacturing coupled with an end to Brexit-related stockpiling,