The UK fell into recession in the second half of 2023, new GDP figures show.

GDP shrank by 0.3% in the last three months of 2023. That follows a fall of 0.1% in the previous quarter, July to September.

Despite GDP falling in successive quarters, it did grow by 0.1% across the whole of 2023, the data shows

The last time the UK's economy was in recession was 2020, during the Covid pandemic.

Chancellor Jeremy Hunt admitted that today's data was "challenging" - but that tackling inflation "had to come first".

He told the BBC that the turning point for the economy "will come when inflation falls to its target of 2% and the Bank of England feels it can bring down interest rates.

"Whilst interest rates are over 5%, the highest for 15 years, of course growth is going to be weaker here, like it is in many countries."

Inflation has fallen from a high of 11.1%, in October 2022, to 4% - so it's still twice the Bank of England's target of 2%.

At the beginning of 2023, PM Rishi Sunak pledged to grow the economy. Now, the chancellor says that when the commitment was made, Sunak was "very clear, tackling inflation had to come first".

He added: "The big picture is that, actually, since then the economy has been more resilient, unemployment has stayed low, real wages have been rising now for six months, and if we stick to our guns now, we can see light at the end of the tunnel."

Alex Veitch, director of policy and insight at the British Chambers of Commerce (BCC), said:  "A contraction in GDP for the final quarter of 2023 means the UK economy is in technical recession. Businesses were already under no illusion about the difficulties they face, and this news will no doubt ring alarm bells for Government.

"The BCC's last Quarterly Economic Forecast suggests annual growth below 1.0% for the next two years as firms remained gripped by uncertainty and the twin perils of high inflation and interest rates remain.

"The Chancellor must use his Budget in just under three weeks' time to set out a clear pathway for firms and the economy to grow.

"Businesses are crying out for a long-term economic plan that reduces the cost pressures they are facing and unlocks the investment they so sorely need."