Scotland's economy grows slightly to avoid recession

Scotland's economy has narrowly avoided recession, the latest figures show.

The country's chief statistician has revealed output grew by 0.1% in real terms between October and December.

Scotland was at risk of recession - defined as two consecutive quarters of falling output - after the economy shrank by 0.2% between July and September.

Acting finance secretary John Swinney said the figures show the "resilience" of the country's economy.

Although gross domestic product (GDP) grew by 0.1% in the past quarter, it remains 0.3% below pre-pandemic levels.

The figures also show overall output has grown by 0.6% compared with the same period in 2021.

'Enormous pressures'

Mr Swinney, who also serves as deputy first minister, said: "These figures demonstrate the resilience of the Scottish economy against the extremely challenging circumstances faced by countries around the world."

"Despite recession being avoided last year, enormous pressures remain across both the private and public sectors.

"The cost of living crisis is impacting household and businesses' ability to spend

"Scottish businesses also continue to suffer due to the effect Brexit has had on supply chains, trade and the free movement of people, which had a significant impact on businesses in terms of staffing."

• Downturn 'deepens' in Scotland amid falling demand

• One in six shops in Scotland lying vacant - report

• Air fryers give boost to Scottish retail sales

Despite a slight increase in GDP in the last quarter of 2022, the report reveals a 0.6% decrease in December, coinciding with weak growth in the construction sector and decreases across the services and production sectors.

The services sector, comprising of government and other services, is by far the largest of Scotland's high level industries. Its output remained flat between October and December, at 0%.

The construction sector grew by 0.6%, followed by production at 0.2%. The agriculture, forestry and fishing sector shrank by 0.3%.

Scottish Secretary Alister Jack said that the economy had "proven to be more resilient than many feared, but there are still challenges ahead".

He insisted it was the UK government's priority to halve inflation, reduce debt and grow the economy.

Mr Jack added: "We are providing immediate vital support to ease the cost of living, providing help for those most in need by increasing benefits and pensions in line with inflation and raising the National Living Wage. This is in addition to extra help with energy bills and on top of an extra £1.5 billion for the Scottish Government to help support public services in Scotland."