15.06.202015:41 Forex Analysis & Reviews: Economy falls deeper than expected

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Exchange Rates 15.06.2020 analysis

Great Britain has paid an enormous price for stemming the spread of the coronavirus in the country. Today, the Office for National Statistics released a report stating that GDP dropped to a record 20.4% on a monthly basis in April. Economists had expected a decrease of just 18.7%. Furthermore, a slump was recorded in all sectors of the economy.

The aviation sector is the most damaged by the virus. There, output slumped by 92.8%. The hotel and restaurant industry also suffered a decline of 88%.

The pandemic had an extremely negative impact on the UK trade compared to other counties, the document stated. Both imports and exports significantly dropped.

The data presented in the ONS report exceeds figures recorded during the 2008 economic crisis. Then, the 1% decline was logged at the peak of the financial crisis.

Also, in April, the visible trade balance improved. It turned out to be positive and amounted to 305 million pounds against a deficit of 3.956 billion in March. Nevertheless, this improvement was the result of a dramatic drop in the trading volume.

This situation may negatively affect the reputation of Prime Minister Boris Johnson. The pressure on the UK leader is growing, as many people criticize him for the decisions made during the pandemic.

By the way, according to the latest data, more than 41 thousand people died from COVID-19 in the UK. The total number of infected people exceeded 290 thousand.

Kate Smirnova
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