|
|
The Office for National Statistics said gross domestic product contracted by 0.4% from the previous month, fuelled by a fall in spending on the high street over the key festive shopping period.
With less than 50 days to go before Brexit, the figures showed all three drivers of growth in the British economy – services, production and construction – shrank during December.
The decline in monthly output helped drag down quarter-on-quarter growth to a rate of 0.2% in the three months to the end of the year, slightly below the Bank of England’s expectations and down from a rate of 0.6% in the third quarter.
Economists tend to focus on the three-month figures, as monthly GDP snapshots can be prone to revision, but the scale of the decline in December is likely to be seen as a sign of the economy losing momentum as Brexit draws nearer.
For 2018 as a whole, GDP growth slipped to its lowest since 2012, at 1.4%, down from 1.8% in 2017.
Despite the broad-based slowdown, Philip Hammond, the chancellor, said the latest figures showed that Britain’s economy remained fundamentally strong.
“The UK is currently enjoying the longest unbroken quarterly growth streak of any G7 nation,” he said.
However, the latest monthly figures revealed that manufacturing output tumbled into recession territory with the sixth consecutive month of falling output. This marked the longest negative run since September 2008 to February 2009, the depths of the financial crisis. [...]