UK GDP recorded largest second-quarter drop on record

The UK economy shrank marginally less than initially estimated in the second quarter of this year, but still recorded its largest fall on record and the worst contraction among major economies.

Revised data from the Office for National Statistics show output in the UK dropped 19.8 per cent in the second quarter compared with the previous three months. This is a marginally smaller contraction than the first estimate of 20.4 per cent.

“More complete data has not substantially changed the economic picture, with the UK economy still shrinking by around a fifth in the first half of the year, far bigger than any previous contraction on record,” said Jonathan Athow, the ONS’s deputy national statistician and director-general for economic statistics. 

Despite the upward revision, the fall is the largest since ONS began recording quarterly GDP in 1955 and shows that in the second quarter, the UK economy contracted more than twice as rapidly as those of the US and Germany.

With limited spending opportunities, the households’ saving ratio — the average percentage of disposable income that is saved — increased to a record 29.1 per cent, up from 9.6 per cent in the previous quarter.

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