“This time it is a pandemic responsible whereas again then, it was a Nice Frost, which noticed ice within the North Sea, and the Conflict of Spanish Succession … which was doing the harm,” wrote Societe Generale strategist Package Juckes in a analysis be aware on Friday.
However there have been large swings in output between October and December, largely monitoring the extent of restrictions imposed to include the coronavirus.
America fared even higher by comparability, with GDP reducing by three.5% from the prior yr.
“Right now’s figures present that the financial system has skilled a critical shock because of the pandemic, which has been felt by nations world wide,” UK finance minister Rishi Sunak mentioned in a press release. “Whereas there are some optimistic indicators of the financial system’s resilience over the winter, we all know that the present lockdown continues to have a big affect on many individuals and companies.”
“Evidently a double dip [recession] was merely delayed quite than averted outright,” Sam Miley, an economist on the London-based Centre for Economics and Enterprise Analysis mentioned in a be aware on Friday.
Disruption to EU-UK commerce following the top of the Brexit transition interval on December 31 can also be weighing on exercise.
The survey additionally discovered that just about 40% of British adults suffered financially as a consequence of the pandemic, with youthful employees, Black individuals and the self-employed among the many hardest hit.
“The fast rollout of the vaccination programme throughout the UK means a decisive nook has been turned within the battle in opposition to Covid,” he mentioned. “A decisive nook is about to be turned for the financial system too, with monumental quantities of pent-up monetary power ready to be launched, like a coiled spring,” he added.
— Will Godley contributed to this text.