In Britain, there will be a public holiday on Thursday, as the country celebrates 2. The 70th anniversary of the reign of Queen Elizabeth. However, analyzes indicate that this will have a significant impact on the UK economy. So much so, that due to the holidays, GDP may shrink in the second quarter.
Britain’s GDP may decline in the second quarter of this year, in part due to British governance. On Thursday, there will be a public holiday in the country, because after that the second. The 70th Anniversary of the Reign of Queen Elizabeth.
The Bloomberg Economics He studied the potential economic effects of anniversaries based on previous holidays. Analysts concluded that the holiday could cut UK GDP by about half a percentage point in the second quarter.
In addition to lost productivity due to holidays, the health sector’s underperformance is also contributing to the downturn in the economy. So it turns out that Bloomberg expects UK GDP to shrink by 0.4 per cent in the second quarter of this year.
However, interruption is, by definition, temporary, That is, analysts are not afraid that the next quarter will continue to decline. Thus, Britain is expected to avoid a so-called technical recession, which means that GDP will shrink for two consecutive quarters. Analysts are currently forecasting 0.3 percent growth in the third quarter.
The current estimate is also important because it highlights how difficult it is for Britain to recover from the economic hardship caused by the coronavirus pandemic. Although the country’s production has jumped sharply with the reopening, consumer confidence has deteriorated significantly in recent months. In addition, inflation, which has reached its highest level in 40 years, is generally considered a great deterrent to economic growth.
Another important aspect of the vacation is that many people may choose to take a day off and plan a long weekend for themselves. Silvia Dal Angelo, chief economist at Federated Hermes, added that this, as a mass phenomenon, could hamper British production.
However, a person skilled in the field believes that the extra free time can ultimately have a positive economic impact. This is because workers are more able to relax, which increases their productivity.
