Matt Britzman, senior equity analyst at Hargreaves Lansdown, said: “UK markets opened lower this morning, weighed down by a softer than expected GDP print and ongoing tensions in the Middle East.
“The economy failed to grow at all in January, suggesting activity was already subdued even before the recent jump in energy prices began to bite.
“That’s starting to force a rethink of this year’s outlook, with previous one per cent growth expectations now looking optimistic – with some scenarios pointing to closer to 0.6 per cent, 0.4 per cent or even 0.1 per cent, depending on how long elevated energy costs stick around.
“While some temporary factors may have played a role, the broader concern is that rising energy prices from March onwards are likely to squeeze both household spending and business investment, potentially leading to a loss of momentum in growth in the months ahead, just as inflation risks remain elevated.”
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