Contrary to expectations, the performance of the British economy rose in May, mainly due to the strong activity of the service sector.
Based on the first estimate published by the British Statistics Office on Wednesday
UK GDP rose 0.5% in May.
A month earlier, in April, a monthly decline of 0.2 percent was measured in the island nation. Analysts expect a recession at most in May as well, but there were expectations for a 0.1% drop in monthly GDP.
According to the Office for National Statistics, Britain’s GDP rose 3.5% compared to last May. Britain’s GDP in May was 1.7 percent higher than it was in February 2020, the last full month before nationwide restrictions imposed from March 2020 to curb the coronavirus epidemic.
The British are in a serious government crisis, and analysts are speculating who will succeed resigned Boris Johnson.
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Within the GDP growth in May, the performance of the service sector, which produces 80 per cent of Britain’s GDP, rose by 0.4 per cent, and this was the main factor in the monthly growth of GDP. in May.
In this sector, the 2.1 percent monthly growth for healthcare services has been the main driving force, despite the fact that healthcare services activity directly related to the coronavirus pandemic is decreasing.
Both the decline in GDP in the second quarter of 2020 and the year as a whole was unprecedented in the recent history of the British economy. In 2020, the value of Britain’s GDP plummeted to the level of 2013, which means that the shock of the coronavirus epidemic consumed seven years of growth in one year.
According to London macroeconomic analysts, despite unexpectedly strong GDP growth in May
The British economy could still plunge into recession this year.
However, according to London-based Capital Economics analysts, the main reason for the drop they expected for June is an unusual four-day holiday announced for the British monarch’s platinum jubilee, the 70th anniversary of his accession to the throne, so the expected quarterly drop will only be statistically significant, The Bank of England will likely miss the quarterly decline in its current forecast.
In its latest forecast, the Bank of England Monetary Council estimated that Britain’s gross domestic product (GDP) fell 0.3 percent on-quarter in the second quarter as a whole due to the drop in April.
