UK gross domestic product rebounded slightly last July in a period of improvement that could be short to counter a looming recession, and was exacerbated by a bank holiday due to the Queen’s funeral.
The Office for National Statistics announced that gross domestic product rose slightly by 0.2 percent in July after declining by 0.6 percent in June, mainly due to the service sector.
On the other hand, the manufacturing and construction sectors declined during this period.
And if the gross domestic product is increasing, it’s mainly because of its “weakness in June”, especially because of the celebration of the anniversary of Queen Elizabeth II, who passed away last Thursday, and who gave two public holidays, which is more than usual, says Yael Selvin, economist at KPMG.
While Samuel Thoms, an economist at Pantheon Macroeconomics, says next week’s holiday “could be more damaging to the economy than an extra public holiday in June because it won’t benefit the hotel and tourism sectors. Many businesses will close.”
“But many companies can recoup their losses, as most of them did in June,” he added.
In general, major royal events give a boost to tourism and trade, especially in the field of souvenirs, according to John Blassard, an analyst at Mirabaud.
The UK gross domestic product in July was 1.1% higher than before the pandemic, but still slightly below the May level.
Yael Selwyn said it was “worrisome” as it “points to a general downturn in the first two months of summer” as the UK economy is at risk of recession “due to continued pressure on household incomes and an increased operating burden on businesses” . “.
Source: AFP