You are here: Home - News -

UK economy shrunk by two per cent as pandemic took hold

by:
  • 13/05/2020
  • 0
UK economy shrunk by two per cent as pandemic took hold
The UK economy shrank by two per cent in the first three months of the year, its sharpest contraction since the peak of the financial crisis.

 

In March alone – the month lockdown started – GDP growth fell by 5.8 per cent, the biggest monthly fall on record, according to the Office for National Statistics (ONS).

The ONS said the arrival of the coronavirus pandemic hit nearly every aspect of the economy.

April’s GDP figures are expected to be even worse as the lockdown was only in place for seven working days in the January to March period.

“With the country in full or partial lockdown well into the second half of the year, the grim economic milestones hit in the latest data will be shattered next time around,” said James Smith, research director at think tank, the Resolution Foundation.

The ONS figures show growth in the services sector fell by a record 1.9 per cent in the first quarter, 2.1 per cent in the production sector and 2.6 per cent in construction.

Suren Thiru, head of economics at the British Chamber of Commerce, said: “The contraction in UK GDP in the first quarter underscores the negative impact that coronavirus had on the economy, even at its earliest stages.

“The speed and scale at which coronavirus has hit the UK economy is unprecedented and means that the Q1 decline is likely to be followed by a further, more historically significant, contraction in economic activity in Q2.”

Two consecutive quarters of negative growth will take the UK into a full-blown recession.

 

There are 0 Comment(s)

You may also be interested in

Read previous post:
Home moves allowed as property market reopens from lockdown

People in England are again allowed to view properties and move home, as the property market begins to reopen after...

Close