UK economy shrinks for first time since 2012

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The United Kingdom’s economy shrank this year for the first time since 2012, its government said Friday.

A report from the Office for National Statistics (ONS) found the country’s gross domestic product to have contracted by 0.2 percent after experts had initially expected a flat growth for the U.K.’s economy in the second quarter of 2019, according to CNN Business.

{mosads}The worrying economic outlook for the U.K. has raised fears among experts that the country could enter a recession if it fails to reach a favorable deal with the European Union (EU) before exiting the body later this year.

CNN Business reported that the largest shrinkage in the U.K.’s economy occurred last quarter in its manufacturing sector, where uncertainty about Brexit led to a 1.4 percent drop in output in the second quarter.

Britain’s service economy fared little better, according to the ONS.

“The often-dominant service sector delivered virtually no growth at all,” ONS head of national accounts Rob Kent-Smith told CNN.

U.K. Treasury chief Sajid Javid, a Conservative ally of Prime Minister Boris Johnson, said that the country’s economy was experiencing a “challenging period across the global economy,” CNN reported.

“The fundamentals of the British economy are strong — wages are growing, employment is at a record high and we’re forecast to grow faster than Germany, Italy and Japan this year,” he said.

Johnson, who took office earlier this month, replaced former Prime Minister Theresa May who left office after being unable to pass an agreement to leave the EU through Parliament.

Tags economy global economy Theresa May United Kingdom

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