For the first time since 2020, the monthly rate of UK GDP fell for the second month in a row!

Despite the UK Chancellor of the Exchequer stating that October's GDP figures were disappointing, analysts still believe that the Bank of England is unlikely to cut interest rates at next Thursday's meeting.Ahead of the new UK government's first budget, the UK economy contracted for a second consecutive month in October, marking the first time since the outbreak of the New Crown epidemic that output fell in two consecutive months.The Office for National Statistics (ONS) said the UK's gross domestic product (GDP) fell by 0.1 per cent on a year-on-year basis in October, after a similar drop in September.It was the first back-to-back monthly GDP declines since March and April 2020 (when the UK imposed its first blockade due to the New Crown epidemic), although monthly GDP figures are volatile and prone to revision.Economists polled by Reuters had forecast 0.1 per cent monthly growth for the UK in October.The services sector stagnated, while manufacturing and construction output fell in October.Friday's data added to a series of weaker-than-expected figures for the UK economy, with business surveys and retail sales data also coming in flat.In a statement, UK Chancellor of the Exchequer Rachel Reeves said, "While this month's data releases have been disappointing, we have policies in place to deliver long-term economic growth."Her budget statement on 30 October saw significant tax rises on businesses, but also increased investment and spending on public services.The impact of these measures will start to show up in November's GDP figures.An ONS statistician said rumours of the budget impact were "mixed", with some firms saying turnover had been affected by customers waiting for the Reeves announcement, while others had moved ahead with activity.The pound fell about 0.30 per cent against the dollar.Investors continue to expect around three rate cuts of 25 basis points each from the Bank of England by the end of next year.Paul Dales, chief UK economist at Capital Macro, said the BoE is unlikely to cut rates at next Thursday's meeting.He added: "That said, our confidence in this is not as strong as it was before these data releases."Separately, trade data released by the Office for National Statistics (ONS) showed that the UK's exports and imports of goods both fell in October.For the first time in almost a year, exports of goods to the EU were higher than exports to the rest of the world.Hailey Low, associate economist at NIESR, says: "A weaker export environment against a backdrop of rising global policy uncertainty and declining business confidence, coupled with the impact of recently announced budgetary measures, has fuelled concerns about maintaining growth momentum."Last month, the Bank of England cut its annual growth forecast for 2024 to 1 per cent from 1.25 per cent, but predicted stronger growth of 1.5 per cent in 2025, reflecting the short-term boost to the economy from Reeves's massive spending budget plans.The UK's economic output has grown slowly since the epidemic.Of the major developed economies, only Germany has performed significantly worse, with its economy similarly hard hit by soaring energy costs in the wake of the Russian-Ukrainian conflict.