Economy grows by 0.5% – however Rachel Reeves accused of killing progress | Politics | News | EUROtoday

Rachel Reeves was accused of killing financial progress “stone dead” regardless of higher than anticipated figures. Britain’s financial system grew sooner than anticipated in February, because the providers and manufacturing sectors picked up after current sluggish exercise, official figures present. The Office for National Statistics (ONS) mentioned gross home product (GDP) grew by 0.5%, stunning economists who had forecast no financial progress.

And Chancellor Rachel Reeves mentioned Donald Trump’s commerce tariffs bonanza had upended prospects for the worldwide financial system in current weeks.

The levies may derail the Government’s plans to develop the financial system, and so they got here into power simply after Chancellor Rachel Reeves made a collection of cuts on the spring assertion in an effort to restore a slim buffer within the public spending headroom.

But Shadow Chancellor Mel Stride mentioned: “Since coming to office, Labour’s choices have killed growth stone dead and there is still a long way to go to recover.

“At the emergency budget, the forecasts for growth, inflation and borrowing all moved in the wrong direction because of Labour’s decisions.

“Hardworking families deserve better than a Government crowing about sluggish growth whilst they will be £3,500 worse off because of the Jobs Tax.”

David Morrison, Senior Market Analyst at FCA-regulated fintech and monetary providers supplier, Trade Nation, mentioned “Finally there’s some good news for UK Chancellor Rachel Reeves. But it’s also the case that one number doesn’t make a trend. The outlook for the UK economy remains downbeat, with the added uncertainty of the effects of Trump’s watered-down tariffs.

“Amid the continued tariff chaos, the market response to the better-than-expected knowledge was understandably muted. Sterling briefly spiked greater, whereas the FTSE 100 futures added to features as they adopted the in a single day rally in US inventory index futures.”

Chancellor Rachel Reeves said: “These progress figures are an encouraging signal, however we aren’t complacent.”

She added: “The world has modified and we have now witnessed that change in current weeks.

“I know this is an anxious time for families who are worried about the cost of living and British businesses who are worried about what this change means for them.

“This Government will stay pragmatic and cool-headed as we search to safe the very best cope with the United States that’s in our nationwide curiosity.

“At the same time, we will be relentless in our work to kickstart economic growth, provide security for working people and renewal for Britain.”

It additionally marks a major month-to-month enchancment after no progress in January, the ONS added.

The figures come as a shock increase for Labour and Chancellor Rachel Reeves, after the celebration made rising the financial system its key precedence since profitable the election final yr, however momentum has been sluggish amid falling client confidence and rising inflation.

ONS director of financial statistics Liz McKeown mentioned: “The economy grew strongly in February with widespread growth across both services and manufacturing industries.

“Within providers, laptop programming, telecoms and automotive dealerships all had sturdy months, whereas in manufacturing, electronics and prescription drugs led the way in which and automotive manufacturing additionally picked up after its current poor efficiency.

“Across the last three months as a whole, the economy also grew strongly with broad-based growth across services industries.”

Prime Minister Sir Keir Starmer has rejected options he should hike taxes or slash spending due to Donald Trump’s tariff blitz.

The Starmer authorities set out new fiscal guidelines in October 2024, at Rachel Reeves’ first price range as Chancellor, which stop borrowing to fund day-to-day spending.