Brexit: Jacob Rees-Mogg weighs in on Northern Ireland Protocol
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The Chancellor said the UK economy is now “bigger than it was before Covid” as he boasted about Brexit Britain’s performance against the EU’s biggest economy.
Mr Sunak tweeted: “Growing the economy is one of the best ways to help with the cost of living and that’s why I’m pleased today’s figures show the UK economy is continuing to grow.
“The economy is now bigger than it was before Covid hit, and growing faster than the US, Germany, France, and Italy.”
The boost comes despite Office for National Statistics (ONS) figures showing Britain’s economy shrank unexpectedly in March.
The ONS said gross domestic product (GDP) fell by 0.1 percent month on month in March after growth stalled in February – revised down from the 0.1 percent previous growth estimate.
Experts had expected growth to remain flat in March.
The data shows the impact of soaring inflation on consumer spending, with retail particularly hard hit.
The ONS said the economy grew at its slowest pace for a year in the first quarter overall, with growth of 0.8 percent, down from 1.3 percent in the previous three months.
While the expansion means GDP is now 0.7 percent above levels seen before the pandemic struck, the figures mark the calm before the storm as warnings grow over a recession in the UK due to the cost-of-living crisis.
The National Institute of Economic and Social Research (Niesr) think tank predicted on Wednesday that the UK will fall into recession, forecasting a GDP contraction in the third and fourth quarters.
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Calls are growing for an emergency budget to address the cost-of-living crisis, despite the Government having dismissed the need for further urgent action.
The Bank of England raised interest rates to a 13-year high of 1 percent last week to try to curb inflation, and warned that the economy is set to stall in the second quarter, before contracting in the final three months and going into reverse overall in 2023.
While it said the UK is set to avoid a technical recession – defined as two quarters in a row of falling GDP – Governor Andrew Bailey said growth will be “very weak”.
In a grim set of forecasts, the Bank predicted that household incomes will suffer the second biggest decline on record this year, with inflation expected to peak at more than 10 percent in October.
Mr Sunak said the UK is facing “anxious times”.
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“Our recovery is being disrupted by Putin’s barbaric invasion of Ukraine and other global challenges, but we are continuing to help people where we can,” he told Sky News.
He added that he cannot make global challenges “disappear”.
“What today’s figures show is that, in spite of global inflationary challenges, the UK economy remains resilient,” he said.
“The economy is bigger than it was before coronavirus, and over the last few months we’ve grown faster than America, Germany, France and Italy, for example.”
Figures from the International Monetary Fund have shown that the UK economy is growing faster than many of its peers in the G7, but it also fell further during the pandemic.
Mr Sunak said: “I know these are anxious times, and, unfortunately, because the challenges we face are global in nature, I can’t just make them all disappear.”
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