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UK economy beats expectations with November growth

The UK economy unexpectedly grew in November, helped by a boost from the World Cup, official figures show.

The economy expanded by 0.1%, helped by demand for services in the tech sector and in spite of households being squeezed by rising prices.

The Office for National Statistics (ONS) said pubs and restaurants also boosted growth as people went out to watch the football.

But it is still unclear whether soaring costs will tip the UK into recession.

Although the November reading of gross domestic product – a measure of all the activity by businesses, the government and people in the UK – was much better than anticipated, the overall picture still suggests the economy is stagnating as food and energy bills go up and people cut back.

The November increase marks a slowdown from a 0.5% rise in October, which was largely as a result of a bounceback from businesses shuttering to mark Queen Elizabeth II’s funeral in September.

Economists have suggested that the latest data makes it less clear whether the UK will have entered a recession at the end of last year.

A recession is defined as two three-month periods, or quarters, of shrinking economic output in a row.

When a country is in recession, it is a sign that its economy is doing badly. During a downturn, companies typically make less money and the number of people unemployed rises. Graduates and school leavers also find it harder to get their first job.

Between July and September, UK economic output shrank by 0.3%.

Economic growth slowed sharply from October, partly due to strike action.

Rail workers and Royal Mail staff staged walkouts over pay and working conditions in November. Darren Morgan, director of economic statistics at the ONS, told the BBC’s Today programme: “We definitely saw the impact of industrial action in today’s figures.

“We saw reasonably large falls in rail transport, postal work and warehousing and this sector had the biggest drag on the economy in November.”

There was continued industrial action in December, which widened to include NHS workers as well as Border Force staff at six UK airports. It could have a knock-on effect on next month’s figures, which will reveal if the technical definition of a recession has been met.

Mr Morgan said the economy would have to shrink by 0.6% in December to send the UK into a recession.

Although there might have been a brief improvement in November, the Federation of Small Businesses (FSB) warned that concerns over the economy haven’t yet been laid to rest.

The national chair of the FSB, Martin McTague, said: “With costs remaining high for small firms and households alike, policymakers cannot rest on their laurels. Inflation needs to be brought down, there remains huge uncertainty over energy prices and consumer confidence remains stubbornly low.”

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