UK economy finally bigger than before pandemic in November
Written by on January 14, 2022
January 14, 2022
LONDON (Reuters) – Britain’s economy grew by a much stronger-than-expected 0.9% in November, finally taking it above its size just before the country went into its first COVID-19 lockdown, the Office for National Statistics said on Friday.
The world’s fifth-biggest economy was 0.7% bigger than it was in February 2020, the ONS said.
Economists polled by Reuters had forecast monthly gross domestic product growth of 0.4% for November.
“It’s amazing to see the size of the economy back to pre-pandemic levels in November – a testament to the grit and determination of the British people,” finance minister Rishi Sunak said.
Other economies have already recovered their pre-COVID size, chief among them the United States.
Despite November’s growth acceleration, GDP probably took a hit in December when the Omicron coronavirus variant swept Europe, and the loss of momentum is likely to have stretched into January with many firms reporting severe staff absences and consumers still wary of going out.
But health officials think the Omicron infections wave has now peaked in Britain and analysts say the hit to the economy is likely to be short-lived, allowing the Bank of England to continue raising interest rates this year.
The ONS said, data revisions aside, GDP in quarterly terms would reach or surpass its pre-coronavirus level in the October-December period of last year, as long as economic output does not fall by more than 0.2% in December.
The ONS said architects, retailers, couriers and accountants had a bumper month in November and construction recovered from several weak months as raw materials became easier to source after problems in global supply chains.
Britain’s economy will still face challenges in the months ahead, even once coronavirus restrictions are relaxed.
“While the UK economy should rebound once Plan B measures are lifted, surging inflation and persistent supply chain disruption may mean that the UK’s economic growth prospects remain under pressure for much of 2022,” Suren Thiru, head of economics at the British Chambers of Commerce, said.
(Writing by William Schomberg and Alistair Smout; editing by Guy Faulconbridge and Toby Chopra)