UK, April GDP Down 20%... Largest Monthly Decline Ever

▲Andrew Bailey, Governor of the Bank of England [Image source=Reuters Yonhap News]

[Asia Economy Reporter Kwon Jae-hee] Due to the impact of the novel coronavirus infection (COVID-19), the United Kingdom's gross domestic product (GDP) plummeted by more than 20% in April.

On the 12th (local time), the UK Office for National Statistics (ONS) announced that April GDP decreased by 20.4% compared to the previous month. This is the largest monthly GDP decline on record.

The UK GDP had already decreased by 0.2% in February and 5.8% in March, but in April, it expanded to a drop of over 20%.

Compared to the same month last year, the scale shrank by 24.5%.

By industry, the service sector fell by 19%, production by 20.3%, and manufacturing by 24.3%. The construction industry shrank by a staggering 40.1%.

Over the three months from February to April, the UK GDP decreased by 10.4% compared to the previous three months (November to January). This three-month GDP decline is also the largest since the UK statistics office began compiling related data in 1997.

The significant decline in UK GDP is analyzed to be influenced by lockdown measures due to COVID-19.

Starting March 20, the UK ordered all cafes, pubs, and restaurants to close, and from the 23rd, all stores except essential businesses such as supermarkets and pharmacies were shut down.

The shutdown measures were applied throughout April and have been gradually eased since May, so the UK economy is expected to have hit bottom in April and to recover slowly thereafter.

The Organisation for Economic Co-operation and Development (OECD) forecasted that the UK economy will shrink by 11.5% this year compared to the previous year.

This is larger than France (-11.4%) and Italy (-11.3%), and among major advanced economies, the UK economy is analyzed to experience the largest contraction.

Andrew Bailey, Governor of the Bank of England (BOE), warned on the 10th that "Although the economy is showing signs of recovery due to the gradual easing of COVID-19 lockdown measures, there remains a risk of long-term economic damage."

This content was produced with the assistance of AI translation services.