The pingdemic might stymie the UK’s economic recovery.


The pingdemic might stymie the UK’s economic recovery.

The British economy grew by 4.7 percent in the second quarter, according to official data set to be released on Thursday.

Economists expect the Office for National Statistics to report GDP growth of 0.7 percent in June, bringing the quarter’s growth to 4.7 percent.

The lifting of coronavirus limitations began in April and aided the economy’s recovery from a 1.6 percent contraction in the January-March quarter.

Although growth in the services and construction sectors more than offset a drop in industrial output during the quarter, the economy is still below pre-pandemic levels, according to Paul Dales, chief UK economist at Capital Economics.

He went on to say that the recovery could be hampered by manpower shortages and disruption caused by the spike in people being contacted by the NHS app and instructed to isolate, resulting in third-quarter growth falling short of the Bank of England’s prediction of 3.9 percent.

“We believe the recovery slowed in June, with GDP increasing by only 0.7 percent month over month,” he said. “We suspect activity over the summer may be a little more lacklustre given the recent dataflow,” ING developed markets economist James Smith said. “We’re forecasting 1.5 percent growth in the third quarter.” Bank of America Merrill Lynch UK economist Robert Wood warned that the UK’s return to economic normalcy and recovery could be slowed.

“This year, the economy has made significant progress. The second quarter’s output is expected to be 22% higher than a year ago. But, as a result, output is still in a normal-sized slump compared to pre-Covid levels,” he said. “The final steps in resolving the Covid-19 losses may be the most difficult.”


Comments are closed.