Britain’s recovery from the COVID-19 pandemic accelerated in April as lockdown measures eased, with the fastest monthly growth since July, leaving a record production 27.6% higher than a year earlier, when the virus was rampant and the lockdown was tightest.
Figures from the Office for National Statistics (ONS) on Friday showed rapid growth in the service sector as non-essential retail and hospitality businesses opened after months of closure and schools restarted completely .
Economic output rose 2.3% month-on-month in April, marking the fastest growth since July, the ONS said, and slightly above the Reuters poll consensus for an increase of 2.2%.
“The jump in GDP in April was another sign that consumers are eager to spend as the economy reopens,” said Thomas Pugh, British economist at consultancy firm Capital Economics.
However, UK economic output remained 3.7% below its February 2020 level, before the pandemic triggered lockdown measures, the ONS said.
Prime Minister Boris Johnson wants to completely lift lockdown restrictions in England on June 21, helped by a rapid rollout of COVID-19 vaccines that has brightened Britain’s economic outlook.
But with the Delta variant of COVID-19 first detected in India spreading rapidly, Johnson said lifting the lockdown could be delayed.
April’s growth came despite an unexpected 1.3% drop in industrial production, reflecting widespread maintenance of oil rigs and a shortage of computer chips for automakers.
Production in the services sector jumped 3.4% in monthly terms in April – above all forecasts in the Reuters poll which indicated growth of 2.8%.
The reopening of schools added 0.7 percentage point to GDP growth in April, while the retail and wholesale sector added 0.9 percentage point, the ONS said.
Construction output unexpectedly fell 2.0% in April – although the ONS said this followed a sizable 5.8% jump in March.
“Today’s figures are a promising sign that our economy is starting to recover,” said Finance Minister Rishi Sunak.
Last month, the Bank of England raised its forecast for UK economic growth in 2021 to 7.25%, from 5.0% in February.
It would be the fastest annual growth since 1941, when Britain rearmed itself in World War II. But it comes after production plunged nearly 10%, the biggest drop in over 300 years.
Trade with the EU continues to suffer from the frictions caused by new post-Brexit trade restrictions, but less than at the start of the year.
Compared to three years ago – the last time trade was not affected by COVID or fears of an impending disruptive Brexit – UK merchandise exports to the EU in April were 7.1 % lower and imports from the EU were 15.3% lower.
Exports to the EU were also below their 2019 average.
“It’s a disappointing performance, given the boom in global trade flows; UK exporters have lost market share,” said Samuel Tombs of Pantheon Macroeconomics.
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