KPMG comments on today’s GDP figures

“Squeeze on consumers spells trouble ahead for the UK economy” says Yael Selfin, Chief Economist at KPMG UK.

“After a relatively strong growth at the start of the year, the outlook looks increasingly fraught. While we do not yet see a recession coming this year, weak growth means that additional shocks or spillovers from other economies make this scenario increasingly likely.

“The squeeze on consumers has tightened from the second quarter of this year, with the increase in energy tariffs and the higher cost of food and other commodities arising from the conflict in Ukraine, pushing up the cost of living. At the same time, tighter financial conditions and rising interest rates have seen the cost of borrowing increase.

“The squeeze could lead to a modest fall in GDP as early as the second quarter of this year. Annual growth in 2022 is expected to reach 3.7%, however this figure is flattered by weak economic performance during 2021.

“UK GDP fell by 0.1% in March, after revised no growth in February, while quarter on quarter growth was a healthy 0.8%. This reflected the January bounce-back from the downturn induced by the Omicron variant, and was followed by two months of setbacks to growth.”



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About KPMG

KPMG LLP, a UK limited liability partnership, operates from 22 offices across the UK with approximately 15,300 partners and staff.  The UK firm recorded a revenue of £2.43 billion in the year ended 30 September 2021.

KPMG is a global organisation of independent professional services firms providing Audit, Legal, Tax and Advisory services. It operates in 145 countries and territories with more than 236,000 partners and employees working in member firms around the world. Each KPMG firm is a legally distinct and separate entity and describes itself as such. KPMG International Limited is a private English company limited by guarantee. KPMG International Limited and its related entities do not provide services to clients.

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