U.K. Economy Suffers Biggest Slump in 300 Years Amid Covid-19 Lockdowns – The Wall Street Journal

LONDONThe U.K. economy recorded its biggest contraction in more than three centuries in 2020, according to official estimates, highlighting the Covid-19 pandemics economic toll on a country that has also suffered one of the worlds deadliest outbreaks.

Though the U.K. is grappling with a new, highly contagious variant of the coronavirus, Prime Minister Boris Johnson is hopeful that a rapid vaccination drive will permit a gradual reopening of the economy in the coming months, paving the way for a consumer-driven rebound later in the year.

Gross domestic product shrank 9.9% over the year as a whole, the Office for National Statistics said Friday, the largest annual decline among the Group of Seven advanced economies. Frances economy shrank 8.3% and Italys contracted 8.8%, according to provisional estimates. German GDP declined 5%. The U.S. shrank 3.5%.

However, the data showed the U.K. economy grew at an annualized rate of 4% in the final quarter of the year, aided by government spending and a small uptick in business investment.

The decline in U.K. GDP in 2020 was the largest in more than 300 years, according to Bank of England data, though the preliminary estimate is likely to be revised. BOE data shows the economy last recorded a comparable drop in 1921, when it shrank 9.7% during the depression that followed World War I. The economy last recorded a bigger contraction in 1709, when it tumbled 13% during an unusually cold winter known as the Great Frost.

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U.K. Economy Suffers Biggest Slump in 300 Years Amid Covid-19 Lockdowns - The Wall Street Journal