Commenting on this morning’s UK GDP data, Melanie Baker, Senior Economist at Royal London Asset Management said:
“Flat manufacturing output and a fall in construction helped hold back growth in October. Supply chain problems will be partly to blame, as well as helping to explain current high levels of UK inflation.
“Omicron and recently announced social distancing measures inject downside risk into the near-term outlook for the economy. Uncertainty itself is likely to dampen investment and confidence while we wait for more data on the virus and vaccine efficacy. Without pandemic support programmes like the furlough scheme in place, near-term disruption in demand for services may knock the recovery off course for longer. High inflation, meanwhile, presents a challenge for consumers.”
The views expressed are those of the author at the date of publication unless otherwise indicated, which are subject to change, and is not investment advice.