Image source, PA Media

Chancellor Jeremy Hunt has responded to the UK's latest GDP figures.

“We have a clear plan to halve inflation this year - an insidious hidden tax which has led to hikes in interest rates and mortgage costs, holding back growth here and around the world,” he says in a statement.

“To support families through this tough patch, we will provide an average of £3,500 support for every household over this year and next - but the most important help we can give is to stick to the plan to halve inflation this year so we get the economy growing again.”

Trend still down despite November's surprise growthpublished at 07:46 Greenwich Mean Time 13 January 2023

07:46 GMT 13 January 2023

Faisal Islam
Economics editor

While the surprise today was that the economy grew in the month of November, the trend over three months is still down. Overall the UK economy still appears to be weak but it is not certain it is in formal recession, and depends on the next set of figures released in a month.

The World Cup boosted pubs, pizza delivery and the ad industry helping the economy more than normal. But a series of previous monthly figures from the past year were revised down, leaving the less volatile three-month measure heading downwards. The impact of strikes was partly behind falls in transport and postal services of 4.7% and 3.1% respectively.

So a mixed bag of new and one-off factors, and statistical revisions, that will probably still leave the Bank of England further raising rates next month, as it does its most thorough assessment of the state of economy

Image source, .

Image source, EPA

It's a good question. Gross Domestic Product (GDP) is a measure - or attempted measure - of all the economic activity of companies, governments and individuals in a country.

It is one of the most important tools for looking at how well, or badly, an economy is doing, helping businesses judge when to expand and hire more people, and enabling the government to work out how much to tax and spend.

In the UK, new GDP figures are produced every month, but the quarterly figures - covering three months at a time - are the most widely watched.

In a growing economy, each quarterly GDP will be slightly bigger than the previous three-month period, a sign people are doing more work and getting (on average) a little bit richer.

Most economists, politicians and businesses like to see GDP rising steadily because it usually means people spend more, more jobs are created, more tax is paid and workers get better pay rises.

GDP can be measured in three ways:

• Output: The total value of the goods and services produced by all sectors of the economy - agriculture, manufacturing, energy, construction, the service sector and government
• Expenditure: The value of goods and services bought by households and by government, investment in machinery and buildings - this also includes the value of exports, minus imports
• Income: The value of the income generated, mostly in terms of profits and wages

In the UK, the Office for National Statistics (ONS) publishes one single measure of GDP, which is calculated using all three measurements. But early estimates mainly use the output measure, using data collected from thousands of companies.

Hello and thanks for joining us, let's get right to it. The UK economy grew slightly in November, by 0.1%, better than analysts had expected.

The Office for National Statistics (ONS) said pubs and restaurants contributed to growth as people went out to watch World Cup games.

Despite this, figures for the latest three-month period (September-November 2022) show that the economy still shrank overall, with GDP falling by 0.3%. The ONS said this was mainly due to the impact of the extra bank holiday for the funeral of Queen Elizabeth II in September.

We're going to explore how households and businesses could be affected by the current state of the UK economy, so stay with us.