Coronavirus-hit UK economy shrinks by a fifth in first month of lockdown

The UK’s economy shrank by 20.4% in April – the largest monthly contraction on record – as the country spent its first full month in lockdown due to Covid-19.

The fall massively outstripped the then-record 5.8% drop in March of gross domestic product (GDP) that the Office for National Statistics (ONS) reported last month.

It means that GDP fell by 10.4% in the three months to April and sets the UK on course for one of its worst quarters in history.

Bank of England governor Andrew Bailey said the drop was generally in line with what his experts had been expecting.

“Well obviously it’s a dramatic and big number but actually it’s not a surprising number,” he told Sky News.

“We see signs of the economy now beginning to come back into life.”

Prime Minister Boris Johnson warned of a “tough” few months ahead for the economy, but said: “We will get through it.”

HEALTH Coronavirus
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He added: “We’ve always been in no doubt this was going to be a very serious public health crisis but also have big, big economic knock-on effects.

“The UK is heavily dependent on services, we’re a dynamic creative economy, we depend so much on human contact. We have been very badly hit by this.”

It comes as Transport Secretary Grant Shapps said people from black, Asian and minority ethnic (BAME) backgrounds could undergo greater levels of coronavirus testing due to their increased risk of getting seriously ill and dying from Covid-19.

It is understood that recommendations will be made for people from BAME backgrounds who work in areas such as health and social care to undergo more regular testing.

Mr Shapps told the Downing Street briefing: “My colleague, who’s the equalities minister, Kemi Badenoch, is in the process of working with that report (from Public Health England) to make a series of recommendations.

“But I can give you an early sneak preview when I say that we consider it doubly important to make sure some of those higher-risk environments which coincidentally are environments that black, Asian, minority and ethnic people might be working in get additional support in terms of testing and tracking and tracing.”

HEALTH Coronavirus
(PA Graphics)

Earlier on Friday, the Scientific Advisory Group for Emergencies (Sage) said the reproduction number, referred to as R, of coronavirus across the UK remains between 0.7 and 0.9, while across England it is 0.8-1.0.

Sage also published regional values for R in England for the first time, with the South West having the highest range at 0.8-1.1.

The East of England is at 0.7 – 0.9, London, the Midlands, the North West and the South East at 0.8 – 1.0, and the North East and Yorkshire at 0.7 – 1.0.

But experts said that as the numbers of infections fall across the country, R – which refers to how many people an infected person passes the virus onto –  becomes less reliable.

As the number of infections drop, it is not uncommon for the R value to increase, they say.

For example, if one person passes it on to one other, the R rate jumps to 1.0, and if that infected person infects two others, it jumps further to 2.0, despite a small number of people in the population actually having the virus.

The policy implications when R equals 1.0 when there are 1,000 new infections per day are very different to when R equals 1.0 when there are 100,000 per day.

Alongside Sage, the ONS released new figures showing that the number of people with Covid-19 in England continues to fall.

The number of average infections per day since the end of April has fallen from 5,600 new infections per day to 4,500, according to the latest figures.

This is a snapshot of the average number of infections recorded by ONS taken at weekly intervals.

And it suggests only about one in 1,700 people were infected between May 25 and June 7.

In separate data, the ONS also found a huge difference in death rates from Covid-19 depending on where people live.

North East England had the highest coronavirus mortality rate of all regions in England during May, while London recorded one of the lowest.

South West England had the lowest mortality rate overall during each of the last three months.

Meanwhile:

– Mr Shapps played down reports that the chief nursing officer for England Ruth May was banned from No 10 press briefings because she would not defend the Prime Minister’s adviser Dominic Cummings.

– Matt Fowler, founder of the Covid-19 Bereaved Families for Justice UK group, has called for an immediate public inquiry into the handling of the coronavirus outbreak, saying his 56-year-old father’s death could have been prevented in the pandemic.

– Uber has said that it will make face coverings mandatory for drivers and passengers across the UK from Monday.

– British Airways, easyJet and Ryanair announced they have launched legal action against the Government’s “flawed” 14-day quarantine policy, claiming it will “have a devastating effect on British tourism and the wider economy, and destroy thousands of jobs”.

A raft of papers informing Sage’s work were also released on Friday showing experts said as recently as June 4 that people should continue to follow the two-metre social distancing rule.

The Environmental and Modelling Group (EMG) said that while the risk of outdoor transmission was low people should maintain the distance to avoid contracting coronavirus from face-to-face contact.

In a paper to Sage, the EMG said that a one-metre distance could carry up to 10 times the risk of two metres.

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