The british economy slumped at the start of the corona crisis. However, the jolt was not quite as severe as analysts had feared.
According to the british statistics office ONS, gross domestic product in the first quarter was 2.0 percent below the level of the previous quarter. Analysts had expected a 2.6 percent drop on average.
The decline was only about half that of the euro zone, which contracted by 3.8 percent in the first quarter. However, public life in great britain was curtailed much later than in many countries of the euro zone. The british government was initially reluctant to impose severe restrictions, but has since corrected this course considerably.
Growth data for march show that this rate correction has weighed heavily on the british economy. This month, the economy contracted by 5.8 percent, according to the ONS. It’s a record run. However, here too, market expectations were even more truer, with a drop of 8.0 percent on average expected. Services and construction activity contracted the most, while manufacturing suffered slightly less.
The slump in the first quarter is the biggest blow to the british economy since the severe financial and economic crisis of 2008 and 2009. For the year as a whole, the british central bank expects a drastic slump of 14 percent. This prediction is much more pessimistic than the expectations of many economists and international institutions. However, the bank of england also expects a strong economic recovery for the kingdom in 2021.