BUSINESS LIVE: GDP grows 0.2%; Yew Tree ups Aston Martin stake; Severn Trent eyes £1bn fundraise

A ‘dishonest’ financial adviser at the center of British Steel’s pensions scandal was yesterday fined and banned from working in the sector.

Darren Reynolds was fined £2.2 million by the Financial Conduct Authority after he ‘duped’ savers into leaving their gold-plated pension schemes and putting their money into ‘risky investments’.

The regulator said he ‘dishonestly’ advised more than 670 people – including 150 in the British Steel Pension Scheme – with 511 losing £42.3m, while receiving more than £1m in compensation.

Thomas Pugh, economist at RSM UK:

“The focus of the final Q2 data should be on what happened last quarter, but it was the revisions to previous quarters and years that stole the show this morning.

‘The combination of the previously announced revisions for 2021 and 2022, combined with a much improved first quarter (growth went from 0.1% to 0.3%) means that the economy is instead of 0.2% below the level of before the pandemic was actually 1.8% in the second quarter. taller! Considering the size of the UK economy was around £2.5 trillion in 2022, that adds around £50 billion to UK GDP.

‘Granted, this would still mean that Britain is still at the back of the G7 pack, but it would put it ahead of Germany and the gap between Britain and the rest of the G7 appears significantly smaller. ‘Faster GDP growth during the pandemic won’t change the real economy at the moment, but if the UK economy has become warmer than we thought, this could explain some of the persistent inflation and tightness in the labor market.

‘However, households were still cautious in the second quarter. Household real disposable income (RHDI) grew by 1.2% in the second quarter, but the household savings rate grew by 9.1% from 7.9%, meaning households decided to spend most of their extra save income. This is a trend that will likely continue in the coming year.

“Overall, the economy is still likely to post subdued growth in the third quarter as fewer strikes and a return to more normal weather conditions will boost output in the remaining two months of the quarter.

‘Although our basic view is that the economy will just avoid a recession, we expect meager growth of around 0.1% per quarter in the coming year. But there are signs that the economy has weakened recently and it wouldn’t take much to push us into a recession.”

Gross domestic product grew by 0.2 percent in the second quarter of 2023, in line with expectations, the Office for National Statistics said, confirming that the UK economy is now larger than before the pandemic.