FTSE 100 surges 4% so far this year despite looming recession
The FTSE 100 has started 2023 on a strong foot after hitting fresh highs this week, despite forecasts that the UK is the only major economy heading for a recession this year.
Although London’s top index has cooled off from the record high of 7911.15 reached in yesterday’s session, it remains up 4 per cent since the start of the year.
Today, the index has retreated slightly, falling 0.6 per cent to 7,863.58 at the close, but analysts are predicting more gains for the UK’s bluechip index, with some saying it could reach the 8,000 mark next week.
That’s despite the gloomy outlook for the UK economy, which only narrowly avoided a recession at the end of last year.
Official figures out today have show gross domestic product (GDP) flatlined in the last quarter of 2022, avoiding two consecutive quarters of decline, or a technical recession, after the economy shrank by 0.2 per cent in the third quarter.
A stronger performance in the earlier part of the period was cancelled out by a 0.5 per cent fall in December, with strikes and snow causing chaos, according to the Office for National Statistics.
But GDP remains below its pre-Covid levels, and the Bank of England has predicted the economy will shrink in each quarter of this year.
Prospects for growth in 2023 are limited by the squeeze on households and businesses caused by high inflation, rising interest rates and continued global uncertainty.
Source of data and images: dailymail