GDP drops by 2% as it is 'very likely UK facing significant recession', Chancellor says

13 May 2020, 07:31

The UK economy contracted by 2% in the first quarter of 2020
The UK economy contracted by 2% in the first quarter of 2020. Picture: PA
EJ Ward

By EJ Ward

The UK economy shrank by 2 per cent in the first quarter of 2020 after plunging 5.8 per cent in March as the coronavirus crisis took hold, official figures show.

The first quarter fall was the worst since the end of 2008 at the height of the financial crisis, while the March monthly plunge marked a record tumble

The latest figures show the first direct effect of the Covid-19 pandemic on the UK economy after the country was placed in lockdown to control the spread of the virus.

On Wednesday the Chancellor Rishi Sunak told Sky news it was "very likely" the UK was facing a significant recession.

The latest GDP figures show one of the sharpest declines on record for the UK economy.

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Jonathan Athow, the deputy national statistician for economic statistics at the Office for National Statistics (ONS), said: "With the arrival of the pandemic, nearly every aspect of the economy was hit in March, dragging growth to a record monthly fall.

"Services and construction saw record declines on the month with education, car sales and restaurants all falling substantially.

"Although very few industries saw growth, there were some that did, including IT support and the manufacture of pharmaceuticals, soaps and cleaning products.

"The pandemic also hit trade globally, with UK imports and exports falling over the last couple of months, including a notable drop in imports from China."

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