UK economy suffers worst monthly contraction on record in April
The UK economy contracted by 20.4 per cent over April, the largest monthly shrinkage on record.
The economic downturn reflects the first full month of the UK Covid-19 lockdown.
The Office for National Statistics [ONS] indicated that the contraction over April alone was three times more severe than that which spanned the whole of the 2008 to 2009 financial crash. From the February 2008 peak of that crisis to March 2009, GDP fell by 6.9 per cent.
The three months from February to April displayed a contraction of 10.4 per cent compared with the three months prior.
Meanwhile, the first quarter of the year saw a two per cent contraction, reflecting the first week of lockdown after it came into force on March 23.
Jonathan Athow, the ONS’ deputy national statistician for the economy, said: "April's fall in GDP is the biggest the UK has ever seen, more than three times larger than last month and almost 10 times larger than the steepest pre-Covid-19 fall.
"In April, the economy was around 25 per cent smaller than in February. Virtually all areas of the economy were hit, with pubs, education, health and car sales all giving the biggest contributions to this historic fall."
However, Athow indicated that with lockdown restrictions beginning to be eased from May, it is likely that the economy has endured the most significant blow.
He told the BBC: "Our own surveys and wider indicators have suggested a pick-up in economy activity, but I think it's really too early to know how quickly economic activity will recover in the coming months."
Andrew Wishart of Capital Economics echoed Athow’s thoughts that April should mark the low point in the economic decline.
He said: "Given the lockdown started to be eased in May, April will mark the trough in GDP. So we are past the worst.
"But the recovery will be a drawn-out affair, as restrictions are only lifted gradually and businesses and consumers continue to exercise caution."
The economic statistics for the second quarter, the three months from April-to-June, are also expected to make for uneasy reading.
In response to the news, chancellor Rishi Sunak said: "In line with many other economies around the world, coronavirus is having a severe impact on our economy.
"The lifelines we've provided with our furlough scheme, grants, loans and tax cuts have protected thousands of businesses and millions of jobs - giving us the best chance of recovering quickly as the economy reopens."
Earlier in the week, the Organisation for Economic Co-operation and Development forecast that the UK could suffer the worst economic downturn of Europe’s major economies over the course of the whole year, shrinking by 11.5 per cent.