UK economy recovers strongly in January; Evraz directors resign after Abramovich sanctions – Business Live | company

Good morning and welcome to our ongoing coverage of the world economy, financial markets, the eurozone and the economy.

The UK economy has returned to growth as the economic damage caused by the Omicron variant has eased.

Britain’s GDP grew 0.8% in January, faster than economists had expected, after contracting 0.2% in December as ‘Plan B’ restrictions were put in place after the fast-spreading variant of Covid-19 showed up.

New figures from the Office for National Statistics show that every sector grew in January Services up 0.8% production by 0.7% and construction increased by 1.1%.

Customer-centric service companies experienced a strong rebound. The food and drink sector grew 6.8% in January after the holiday season was severely disrupted as parties were canceled and more people worked from home in December.

Office of National Statistics (ONS)
(@US)

GDP grew 0.8% in January and is now 0.8% above its pre-pandemic peak.

Services grew 0.8% (1.3% up), manufacturing 0.8% (1.6% down) and construction 1.1% (1.4% up) https://t.co/ ldkxuCew1o pic.twitter.com/alaO7y8lEn

March 11, 2022

The rebound in January means the UK economy was 0.8% above its pre-pandemic level:

UK GDP January 2022 Photo: ONS

However, Russia’s invasion of Ukraine now threatens the recovery as the International Monetary Fund is likely to lower its global growth forecasts.

CEO Kristalina Georgieva told reporters last night that the unprecedented sanctions against Russia are pushing the Russian economy into a deep recession.

The crisis is also having global implications: it is pushing up commodity prices, leading to higher inflation affecting real incomes and hurting financial conditions and business confidence.

Georgieva said:

To sum up, we have tragic effects of the war on Ukraine. In Russia we have a significant drop. And we see the likely impact on our World Economic Outlook. Next month we will revise our growth forecasts downwards.

So with the pandemic, we have weathered a crisis like no other. And we are now in even more shocking territory. The unthinkable has happened – we have a war in Europe.

In January, the IMF forecast that the global economy would grow 4.4% this year, compared to 5.9% in 2021.

US President Joe Biden is expected to increase economic pressure on Vladimir Putin Reportedly later today by calling for the end of normal trade relations with Russia.

The move, reported by Reuters and Bloomberg citing anonymous Biden administration sources, would pave the way for higher tariffs on Russian imports and comes on top of widespread sanctions and this week’s decision to ban oil imports from Russia by the US and to ban Britain.

The agenda

• 7am GMT: UK GDP and trade report for January
• Noon GMT: Brazil’s inflation rate for February
• 15:00 GMT: University of Michigan US Consumer Sentiment Survey for March