By Andy Bruce and Suban Abdulla<\/p>\n
LONDON, June 12 (Reuters) – Britain’s economy contracted by 0.1% in April, its first monthly drop since August as the Iran war’s cancellation of \u200cFormula 1 Grand Prix races and other Gulf sporting events delivered a blow to the \u200cBritish entertainment industry.<\/p>\n
Friday’s data from the Office for National Statistics (ONS) showed the first clear signs of an impact from the \u200bU.S.-Israeli war on Iran in terms of British economic growth.<\/p>\n
Output in the dominant services sector declined in April by 0.2%, dragged down by administration and support services, as well as the arts, recreation and entertainment sectors.<\/p>\n
An ONS official said there were reports that cancellation of sporting events in the Middle East had \u200chit related British firms.<\/p>\n
The outbreak of \u2060war resulted in the cancellation of Formula 1 Grand Prix races in Bahrain and Saudi Arabia, which had been due to take place in April. Tennis \u2060and soccer events were also called off.<\/p>\n
Thomas Pugh, chief economist at tax and consultancy firm RSM, said the outlook was set to worsen.<\/p>\n
“Higher energy prices and borrowing costs along with a renewed bout of political uncertainty \u200bare \u200blikely to conspire to bring growth almost to a \u200bstandstill for the rest of the year,” \u200cPugh said, adding that the data added to a sense the Bank of England was likely to leave interest rates on hold next Thursday.<\/p>\n
Investors showed little reaction to Friday’s figures, with the pound steady and financial markets continuing to price in only a small chance of a rate hike this month, with one fully priced in for November.<\/p>\n
Responding to the ONS data, finance minister Rachel Reeves said \u200cthe war in Iran would have an impact on \u200bthe economy but that her plan was the right one.<\/p>\n
Manufacturing \u200boutput rose by 0.4% in April – helped \u200bby a rise in pharmaceuticals production which often sees large swings – helping to \u200coffset a bad month for the services \u200bsector. Construction output also grew \u200bmodestly.<\/p>\n
Overall economic output in the three months to April was 0.7% higher than the previous three months, as economists had expected.<\/p>\n
Separate trade data showed the value of fuel imports surged \u200bin April to \u00a37.1 billion ($9.52 billion), \u200cthe highest reading for three years, reflecting both the surge in oil prices following the \u200boutbreak of war and Britain’s high dependence on imported energy.<\/p>\n
($1 = 0.7459 pounds)<\/p>\n
(Reporting by Andy \u200bBruce and Suban Abdulla; Editing by William James)<\/p>\n","protected":false},"excerpt":{"rendered":"By Andy Bruce and Suban Abdulla LONDON, June 12 (Reuters) – Britain’s economy contracted by 0.1% in April,…\n","protected":false},"author":2,"featured_media":637746,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[84,16156,1294,176973,215374,585,2094,215373,56,54,55],"class_list":["post-637745","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-cancellation","tag-economy","tag-formula-1-grand-prix","tag-formula-1-grand-prix-races","tag-iran","tag-office-for-national-statistics","tag-thomas-pugh","tag-uk","tag-united-kingdom","tag-unitedkingdom"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/637745","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=637745"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/637745\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/637746"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=637745"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=637745"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=637745"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}