So from the beginning of 2024 things were looking better and better into the year under Rishi Sunak. Now under Deer Keir things are going down, down, down - as predicted. “With the UK economy set to be grinding to a halt, inflation rising again and backlash among businesses over tax-raising plans, a “cloudy” economic outlook looms over the Labour Government as 2024 draws to a close.But the Government says it has reset the public finances and is heading into the New Year with more cash and big plans for growth.Since winning the UK’s general election in July, taking the reins after 14 years out of power, Labour has faced sharp swings in the economic outlook and a shifting public mood.From a surprise early election, to a bigger bounce in GDP (gross domestic product), the UK economy whipsawed from peak pessimism to start the year to rapid optimism by spring,” he said.“Pessimism has hit the UK economy again post-budget, however. And the economic outlook remains as cloudy as ever.”2024 begun on a more positive note with the UK economy returning to growth, and surpassing expectations following a short-lived recession at the end of last year.* CPI inflation: 2.6% in November* Regular wage growth: 5.2% in the three months to October* GDP: Negative 0.1% in October, and forecast to be flat between October and December* Public sector net borrowing: £11.2 billion in November* Retail sales: 0.2% volume increase in November* UK interest rates: Held at 4.75% in DecemberBut recent official data showed that GDP declined by 0.1% in October, following a 0.1% fall in September – marking a shift which Chancellor Rachel Reeves admitted was “disappointing”.And new forecasting from the Bank of England showed the economy is heading toward zero growth between October and December, worse than the 0.3% lift it had previously predicted.At the same time, a changing picture for inflation threatens to muddy the waters for the Government in 2025.“The UK won the G7 race to get headline inflation down to target,” Mr Raja said, after Consumer Prices Index (CPI) inflation dropped to spend three months below the 2% target level earlier this year.“A big jump in price momentum looks likely to start 2025, however, with CPI jumping to an eight month high in November at 2.6%.“The rise in national living wage combined with changes to employer national insurance contributions (NICs) will result in a strong pass-through of costs into retail prices,”
Steve Taylor ● 5d