"Bank Closures Cause GDP Decline"…Charles Coronation Dampens UK Economy

Due to increased holidays, bank working days decrease
Royal-related events always cause monthly GDP decline
The decline gradually lessens over time

The United Kingdom's GDP for May this year is expected to decline due to the coronation of King Charles III. This is because the number of working days will decrease due to the holidays following the coronation.

On the 1st (local time), the US news agency Bloomberg reported that the UK's May GDP could slightly decrease due to the coronation, which is scheduled to take place on the 6th. However, the Bank of England plans to remain closed until Monday, the 8th, the following week.

Dan Hanson, an economist at Bloomberg Economics, predicted that the UK's May GDP will decrease by about 0.7% due to this. However, he also forecasted that the following month, without such extended holidays, would see a rebound of a similar scale.

Westminster Abbey in the UK ahead of the coronation
[Image source=Yonhap News]

However, the coronation does not only have negative effects on the economy. With the expansion of online shopping and an increase in stores that remain open, the 'operating rate' of the national economy has increased compared to the past.

In fact, the GDP decline caused by royal events in the UK has been decreasing over time. During the Golden Jubilee celebrating the late Queen Elizabeth II's 50th year on the throne in June 2002, the UK's monthly GDP fell by 2.2%.

However, during the Diamond Jubilee in June 2012, marking the 60th anniversary, the decline was significantly reduced to 1.4%.

In June last year, the Platinum Jubilee marking the 70th anniversary of the Queen's reign, and in September last year, when the Queen's funeral took place, the monthly GDP decreased by 0.7% each time. This suggests that the impact of royal events on the overall UK economy has diminished.

Additionally, royal events can contribute to the national economy by attracting foreign tourists and stimulating domestic consumption. According to estimates by the UK economic consultancy CEBR, the coronation is expected to generate an economic stimulus effect worth a total of ?337 million (approximately 564.2 billion KRW) due to increased foreign visitors and domestic activities.

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