Rachel Reeves has been warned that expected tax rises in October’s Budget could damage growth, after suprise new figures showed the economy flatlining.
Economists said there could be further misery ahead as a result of the chancellor’s decisions and higher energy bills this winter.
In May, the chief economist at the Office for National Statistics (ONS) described the economy as “going gangbusters”.
But the latest figures unexpectedly showed growth has stalled for the second month in a row. The ONS gross domestic product (GDP) recorded no growth in July.
In response, the chancellor said: “I am under no illusion about the scale of the challenge we face and I will be honest with the British people that change will not happen overnight” as she hit out at “14 years of stagnation” under the Conservatives.
She also defended her government’s difficult decisions, including axing the winter fuel payments for almost 10 million pensioners, suggesting the latest figures highlighted why they were necessary.
This story is from the {{IssueName}} edition of {{MagazineName}}.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber ? Sign In
This story is from the {{IssueName}} edition of {{MagazineName}}.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber? Sign In
No title until Reds become road warriors, warns Slot
Liverpool boss says team must match away form of rivals
United stuck in 'purgatory' and facing only one way out
When one prominent football figure caught a glimpse of the Manchester United dressing room recently, they immediately recognised a scene they had seen from rival clubs. That was a squad that \"doesn't know what next\" and feels like it's \"going nowhere\". It isn't intentional, of course, but is a feeling that starts to grip a group when there's no sense of clarity.
Fifa transfer rules 'contrary to EU law', Diarra case finds
Fifa will have to update key paragraphs of its transfer rules to ensure punishment of players for breaking contracts is less draconian, after a European Court of Justice ruling on the Lassana Diarra case.
Marital rape is not rape, argues Indian government
The Indian government has opposed calls to classify consensual sexual acts committed by a husband against his wife as \"rape\", saying that to do so could have an impact on conjugal relationships and disturb the institution of marriage.
Screaming statue tribute to doctor raped and killed in India causes controversy
A bust installed outside a state-run hospital in India where a resident doctor was raped and killed has sparked anger and shock as it depicts a woman screaming in agony, her head thrown back and eyes wide open.
Haitian gang shoots at least 70 people in town rampage
Gang members brandishing automatic rifles have stormed through a town in Haiti's main breadbasket region, killing at least 70 people and forcing another 3,000 to flee.
Beirut hit again by Israel as Iran vows not to back down
Israeli military claims strikes targeted new Hezbollah leaders
Police officers win appeal in athlete stop and search case
Two former Metropolitan Police officers have been handed their jobs back after winning an appeal against a ruling that they had lied about a stop and search incident involving British athlete Bianca Williams.
Royal Navy chief apologises for submarine service abuse
The head of the Royal Navy has apologised after an investigation found \"misogyny, bullying and other unacceptable behaviours\" in the submarine service.
Women say gender equality in the workplace has stalled
Gender equality in the workplace has stalled as women report experiencing many of the same challenges as they did nearly 30 years ago, a new survey of high-flyers suggests.