UK Economy Shrinks Again—Recession Clouds Over Europe?

Fresh data out this morning confirms what many feared: the UK economy contracted by 0.1% in May, against market expectations of a modest 0.1% growth. Instead of a spring rebound, the British economy is once again losing momentum. Analysts point to weak industrial output and declining construction activity as the main culprits behind the negative GDP figure, with services growth unable to offset the slide.

While some argue this is just a temporary dip, others see it as a warning sign that stagflation risks remain very real in post-Brexit Britain. Markets now wait nervously for the next move from the Bank of England.