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UK officially in recession after over 20% economic slump

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With the coronavirus pandemic yet to be brought under control and the economy contracting by over 20 per cent in the second quarter, the United Kingdom (UK) has officially fallen into recession. The inevitable recession is a result of the lockdown measures that were imposed to contain the spread of coronavirus.

The government figures reveal that the British economy has contracted by 20.4 per cent in the second quarter.

According to the Johns Hopkins COVID-19 tracker, the UK has 3.13 lakh coronavirus cases so far. Also, 46,611 deaths have been reported from the country as a result of the COVID-19 pandemic.

UK economy in recession

The slump recorded by the Office for National Statistics follows a 2.2 per cent quarterly contraction in the first three months of the year. As such, the UK economy is in a recession, which is commonly defined as two-quarters of negative growth.

Economy healing slowly

Unlike other countries, Britain’s statistics agency provides monthly figures to accompany the quarterly numbers. These show some hope that the economy is healing in the wake of the easing of some lockdown restrictions.

In June, when shops selling non-essential goods were allowed to reopen, the British economy grew by a monthly rate of 8.7 per cent.

Also Read: India’s COVID-19 death toll crosses 46,000-mark

“The economy began to bounce back in June with shops reopening, factories beginning to ramp up production and house-building continuing to recover,” said statistician Jonathan Athow.

Despite this, he said the economy remains a sixth below its level in February, before the virus started to impact.

More relaxations in the pipeline

The British government hopes that the further easing of the economy over recent months, such as the reopening of the hospitality sector in July, will allow the economy to claw back further ground.

Situation same in other countries

Like the UK, the situation of many other developed and developing economies like the US and India is the same. Due to the prolonged lockdown imposed in these countries, economic activities came to a standstill. This has resulted in widespread job losses cutting across sectors. Local and international travel bans have further aggravated the situation.

 

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