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UK economy grows 2.3 per cent in April as Covid lockdown eases

BRITAIN’S economy grew 2.3 per cent in April as easing of Covid-19 lockdown boosted consumer demand, official data showed Friday (11).

It was the fastest monthly output for UK gross domestic product (GDP) since July "as government restrictions affecting economic activity continued to ease", the Office for National Statistics (ONS) said in a statement.


The economy contracted 1.5 per cent overall in the first quarter, although a strong recovery had begun in March with output of 2.1 per cent.

The UK's overall output for April remains 3.7 per cent below pre-pandemic levels seen in February last year.

A 3.4 per cent growth in the service sector in April was the key driver for recovery, as consumers returned to physical stores, restaurants and bars after the government eased restrictions, the ONS said.

However, output in the production sector dropped 1.3 per cent during the same month, reflecting widespread maintenance of oil rigs and a shortage of computer chips for car manufacturers.

Similarly, the construction sector contracted 2.0 per cent after a strong reading in March.

Since May, the government has further eased restrictions, with people now allowed to eat and drink inside restaurants and bars.

Chancellor Rishi Sunak cautiously welcomed the data amid concerns over the spread of the Delta variant in the UK.

"Today's (11) figures are a promising sign that our economy is beginning to recover," said Sunak.

Emergence of the Delta variant of the coronavirus has raised concerns about the government’s provisional June 21 deadline for further lifting virus restrictions.

According to Public Health England, the Delta variant, also known as the Indian variant, is now the dominant strain in the UK.

Prime minister Boris Johnson recently indicated that the June 21 deadline could be delayed.

A separate data released on Friday (11), showed continuation of trade disruption with the EU because of friction from new post-Brexit trade restrictions.

Compared with three years ago, British goods exports to the EU were 7.1 per cent lower this April, while imports from the region were 15.3 per cent down.

Total exports from the UK fell 0.6 per cent in April after two months of growth.

"That is a disappointing performance, given the boom in global trade flows; UK exporters have lost market share," Samuel Tombs, chief UK economist at Pantheon Macroeconomics said.

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