The UK economy contracted more than expected in July as wet weather and industrial action hit retail spending and affected construction activity, according to official figures released this morning.
Gross domestic product declined by 0.5%, compared to 0.5% growth in the previous month, the Office for National Statistics (ONS) reported. The figure was bigger then economist expections for a 0.2% fall.
Services output fell 0.5% in July, following 0.2% growth in June, while production output dipped 0.7%, driven by a 0.8% fall in manufacturing, and construction also declined 0.5%.
“In July, industrial action by healthcare workers and teachers negatively impacted services and it was a weaker month for construction and retail due to the poor weather,” said Darren Morgan, ONS director of economic statistics.
“Manufacturing also fell back following its rebound from the effect of May’s extra bank holiday.”
He added that “a busy schedule” of sporting events and increased theme park visits provided a slight boost to the economy and said the broader picture looked “more positive”, with GDP up 0.2% in the three months to July.
A very quiet morning for fmcg news on the markets.
The FTSE 100 opened flat after yesterday’s rise.
Early risers included Kerry Group, up 2.4% to €83.54, Hilton Food Group, up 1.8% to 739p, THG, up 1.5% to 93.4p, and M&S, up 1% to 224.9p.
Ocado is down 2.5% to 781.4p, while Haleon is 1.8% lower at 318.1p and Reckitt Benckiser is down 1.4% to 5,694p.
Yesterday in the City
The FTSE 100 climbed 0.4% to 7,527.53pts as wage growth in the UK caught up with rising prices for the first time in almost two years.
Shares in Associated British Foods shot up 5.4% to 2,108p as the Primark owner said it expected profits to beat expectation this year.
Fever-Tree managed to nudge shares 0.3% up to 1,309.1p despite reporting a 50% drop in first-half earnings as it projected a strong recovery in 2024.
Other risers included Glanbia, up 3.8% to €15.81, Just Eat Takeaway, up 3% to 1,085p and B&M, up 1.5% to 579p.
Finsbury Food, Hotel Chocolat and Ocado were among the fallers, down 2.8% to 88.5p, 0.9% to 115p and 0.8% to 801.6p respectively.