Pandemic causes UK’s biggest slump in economic output for 300 years – BBC News
UK economy shrinks 9.9% in 2020, largest annual contraction since coronavirus pandemic disrupted economic activity.
Gross Domestic Product (GDP) grew 1% in the last quarter of the year as the country re-introduced nationwide isolation measures in an attempt to prevent the reappearance of Covid-19 cases, according to the Office for National Statistics (ONS)..
Annual decline of 9.9% more than doubles 2009 figures after the global financial crisis.
Economists surveyed by Refinitiv had expected an annual decline of 8% in 2020 and growth of 0.5% in the fourth quarter. This follows a 16.1% revision of growth in the third quarter as social, travel and business restrictions were eased..
More than 4 million cases and 115,000 deaths were reported in the UK as of Friday morning, according to data compiled by Johns Hopkins University. New and more infectious variants of the virus have hit the UK in recent months.
Hitesh patel, portfolio manager at Quilter Investors, said the UK was impressed by «terrible disease» as «triple strike» – the public health crisis, economic stalls and uncertainty around Brexit.
«However, 2020 is a thing of the past and the UK may have a promising second half of the year ahead, given the success of the vaccine introduction.», – he said.
«This could be easily thwarted if one of the mutations prevents vaccines from taking effect properly, but a double recession has been avoided for now and blockages could soon be a thing of the past.».
England is still in nationwide isolation with no clear end date, although the British Prime Minister Boris Johnson confirmed on Wednesday that roughly one in four adults, roughly 13 million people, received the first dose of the Covid vaccine.
Monthly GDP in December grew by 1.2% compared to the previous month, but remained 6.3% below the level of February 2020. Q4 GDP Remains 6.6% Below Q4 2019 Level.
Services sector grew 1.7% in December, down 3.1% in November, while manufacturing posted an eighth straight month of growth.
«Tightening restrictions imposed towards the end of last year, which are likely to persist for most of the current quarter, suggest that the economy could contract again, he said. Dean turner, economist at UBS Global Wealth Management. “However, it is clear from the data that there is resilience and adaptability of firms and households, so any decline will be small. When the restrictions are lifted, we expect a vigorous economic recovery».
UK Treasury Secretary Rishi Sunak stated: «Today’s data shows the economy was severely shocked by the pandemic hitting countries around the world..
While some positive signs of economic resilience have emerged for the winter, we know that the current lockdown continues to have a significant impact on many people and businesses..
This is why I remain focused on doing my best to protect jobs, businesses and livelihoods.».