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The UK economy shrank marginally in the second quarter of the year from the first, according to the Office for National Statistics on Friday, as the country grapples with cost-of-living increases.
On an annual basis, UK gross domestic product expanded 2.9% in the second quarter, slowing sharply from 8.7% growth in the first quarter. The latest reading just beat the market forecast, cited by FXStreet, for growth of 2.8%.
On a quarterly basis, the UK economy contracted 0.1% in the second quarter following growth of 0.8% in the first quarter. Market consensus had pointed to a 0.2% contraction.
Should the economy contract again in the third quarter, the UK will enter a technical recession.
In June, the final month of the second quarter, the UK enjoyed an extra bank holiday to mark the Queen's platinum jubilee.
UK GDP shrank 0.6% in June month-on-month, having expanded 0.4% in May. The print beat the market estimate for a 1.3% decline.
Last week, the Bank of England forecast the UK economy will enter recession from the fourth quarter of 2022 and will continue to contract throughout 2023.
The warning came as the BoE enacted its largest rate hike for almost 30 years, as it lifted interest rates by half a percentage point to 1.75% from 1.25%.
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