Concerns regarding the UK’s potential recession have intensified following revised official figures revealing a slight shrinkage in the economy during the July to September period.

Revised assessments by the Office for National Statistics (ONS) indicate a 0.1% decline in gross domestic product (GDP) for the third quarter, a downgrade from the previous estimate of no growth. This downward revision poses a challenge for Rishi Sunak, who has pledged to stimulate economic growth, a key commitment to voters in anticipation of an upcoming general election.

The ONS attributed much of this revised performance to weaker showings in sectors such as small businesses, film production, engineering and design, as well as telecommunications and the IT sector.

Moreover, the revised figures for the second quarter indicated zero growth, contrasting with the earlier estimate of a 0.2% expansion. The Bank of England’s series of interest rate hikes, totaling 14 over the past two years and pushing borrowing costs from 0.1% to 5.25%, are believed to have exerted a more substantial impact on both corporate entities and household spending than previously assessed.

The technical definition of a recession involves two consecutive quarters of GDP contraction. Should the UK experience a further contraction in the fourth quarter, it would officially enter this category.

Darren Morgan, ONS’s director of economic statistics, highlighted that recent data from monthly business surveys and VAT returns depicted a marginally weaker performance in the last two quarters than initially estimated. However, he emphasized a broader pattern indicating an economy that has remained relatively stagnant over the past year.