ANAEMIC growth brought a measure of relief to beleaguered Chancellor Rachel Reeves today as fears of a recession diminished.

Official statistics showed the economy grew by all of 0.1 per cent in the last quarter of 2024, ahead of City forecasts.

However, manufacturing continued to contract, falling for the fifth consecutive quarter, with the production sector of the economy shrinking by 0.8 per cent.

The TUC welcomed the news, with general secretary Paul Nowak saying: “There is a lot of work still to do, but the government’s approach is taking us in the right direction.  

“After years of stagnation and falling living standards, families and businesses desperately need change. 

“The government must remain laser-focused on creating secure, decently paid jobs, which are the bedrock of a strong and resilient economy. 

“This is the best way to keep building confidence and boost household spending.”

Ms Reeves herself struggled to sound so upbeat, commenting sternly that she was “still not satisfied with the level of growth that our economy is achieving.

“That’s why I am determined to go further and faster in delivering the economic growth and the improvements in living standards that our country deserves.”

Mr Nowak indicated one way to do that, pointing the government in the direction of “investing in growth.”

He said: “Boosting our essential infrastructure and public services will deliver the improvements our economy urgently needs and is the best way to sustainable public finances.”

That many not be advice Ms Reeves chooses to follow, hypnotised as she is by Treasury-imposed fiscal rules which presently appear to mandate renewed austerity.

That was the warning from SNP economic spokesman Dave Doogan, who argued that “unless the Labour government urgently changes direction, the UK will face another lost decade of stagnation and decline — with families hit in the pocket as bills rise, wages are squeezed, and people get poorer.

“The Chancellor has confirmed she possesses only a notional grasp of fiscal cause and effect and now, on top of failing to fix 14 years of Tory economic decline, she’s added her own economic chaos to the mix.”

Ms Reeves is under fresh fire over her past employment, with the BBC revealing that she had been investigated over her expenses claims while working at the bank HBOS.

A spokesman for Ms Reeves told the BBC that she had no knowledge of the investigation and always complied with expenses rules.