New blow for UK's Starmer as growth data disappoints

LONDON

Britain's economy grew less than initially estimated in the second quarter, revised official data revealed on Monday, dealing another early blow to new Prime Minister Keir Starmer and his Labour government.

Gross domestic product (GDP) was 0.5 percent in the April-June period, the Office for National Statistics said in a statement, while economists expected it to have remained at 0.6-percent expansion.

Britain's Labour government has made growing the U.K. economy a priority after winning national elections at the start of July, but has been knocked off course during its first few months in office by strained economic data and highly-controversial decisions taken by Starmer.

Britain's economy had grown 0.7 percent in the first quarter following a shallow and short-lived recession in the second half of last year.

However, U.K. inflation remains above the Bank of England's target rate, slowing its journey to cutting interest rates.

Recent data has also showed Britain's state debt rising to 100 percent of annual GDP, increasing the likelihood of biting tax rises in Labour's maiden budget on Oct. 30, according to analysts.

The government is already facing criticism from all sides over scrapping a winter fuel-benefit scheme for 10 million pensioners.

Over the weekend, meanwhile, Labour reeled from its first resignation, as lawmaker Rosie Duffield quit the party, accusing Starmer of "hypocrisy" over his acceptance of free gifts.

In a blistering resignation letter, Duffield denounced the prime minister for pursuing "cruel and unnecessary" policies.

Labour ousted the Conservatives in a landslide election win after 14 years in opposition.