London
CNN
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of uk economy The UK has recovered from the coronavirus pandemic much faster than previously thought, according to a major revision to official figures that wiped out UK statistics. late state All night.
new data By the end of 2021, the UK will have: GDP Compared to the last quarter of 2019 before the pandemic hit, it actually expanded by 0.6%, rather than the previously estimated contraction of 1.2%.
The ONS said last month that UK GDP would still not reach pre-pandemic levels by the second quarter of this year.
A dramatic change is The UK economy has grown stronger since the end of 2019 and is no longer the worst performer in the G7, far better than Germany but still lagging behind the US, Canada, Japan, Italy and France. I’m here.
Ruth Gregory, UK deputy chief economist at Capital Economics, said in a research note on Friday: “Average GDP in other G7 countries is 2.8% above pre-pandemic levels, while the UK is 1.5% higher. ‘ said.
“What this means is that the UK economy is no longer far behind in the G7 and not too far from the average.”
But economists cautioned that the positive data would not change Britain’s overall outlook. Nor will it help families in distress. high inflation and Rising borrowing costs.
“Britain growth is still very weak, if not bottomed out,” said Professor Hugh Dixon, who leads research on economic measurement at the National Institute of Economic and Social Research.
Dixon told CNN that the revised data “doesn’t change the real economy in any way.” “For normal businesses and households, this has no effect. It just shows that the measurements are wrong and GDP is slightly higher than we thought.”
John Springford, deputy director of the European Reform Center, a think tank, added: But since 2021, the economy has stagnated, followed by a period of below-trend growth. [2016] Referendum to leave the EU. So while the economy is bigger than we thought, the UK still has growth problems. ”
In 2020, the UK economy suffered its worst recession ever. third centuryrecovered sharply from a low base in the following year.
The ONS said Friday that 2020 GDP is estimated to fall by 10.4%, rather than the 11% previously estimated. This remains the steepest annual contraction since the Great Frost of 1709. The annual GDP growth rate for 2021 was also revised up by 1.1 percentage points to 8.7%.
Darren Morgan, director of economic statistics at the ONS, said the revisions were due to some of the more abundant data, which takes longer to collect.
“Looking to 2020, our more comprehensive research shows that companies are buying more of their unsold inventory rather than getting rid of it,” he told CNN. .
Towards 2021, The latest business survey shows that retail and wholesale profit margins are much better than originally expected, and public and private health sector performance is also strong.
The costs firms incur to produce goods were similarly adjusted, resulting in a positive impact on the services sector, which accounts for the bulk of GDP, but a negative impact on manufacturing. .
UK Finance Minister Jeremy Hunt said the country’s early recovery from the pandemic “demonstrates once again that those determined to undermine the UK economy were proven wrong”. .
But Capital Economics’ Gregory said the data “suggest that the economy is much stronger than previously thought” but did not materially improve the picture.
“The UK is likely still to suffer from a labor shortage, which is no guarantee of long-term resilience in the future.”
The latest GDP revision could simply strengthen the rationale for holding interest rates in the long run, he added. The data “underscores the need for the Bank of England to keep abreast of demand in order to keep inflation under control.”
Nomura economists said of the revisions: There is even a possibility that the risk of recession will increase in the future “because there is little catch-up.”
The UK was one of the first countries in the world to revise its GDP estimates during the pandemic using a more detailed framework, meaning other countries may also change their estimates at a later date.
“It is important to take this into account when comparing the UK to other countries, and our positions in international comparisons are likely to change if other countries fully confront the dataset over time. said ONS.
