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Daily Mirror
Daily Mirror
Business
Emma Munbodh

UK economy grew 4.8% after lockdown restrictions eased in sign of recovery

The UK economy grew by 4.8% in the second quarter of 2021, and rose in June to 1% as lockdown restrictions were eased, the Office for National Statistics (ONS) today said.

The country's gross domestic product (GDP) increased by a further 1% in June, creating five consecutive months of growth.

The economy also speeded up from 0.6% growth in May, the ONS said.

Lockdown restrictions slowly eased through much of the quarter.

Outdoor dining opened again in April, the first month the quarterly data includes, and further restrictions were lifted in May.

During this period, demand for accommodation and food services surged, as did retail, helped by Euro 2020.

Retail, hotels and restaurants also benefited greatly as social distancing restrictions eased.

Previous forecasts estimated the UK economy to grow by 7.25% in 2021 (Bloomberg via Getty Images)

Another major contributor to the growth was GP surgeries across the country.

The number of people visiting their doctors for non-Covid complaints rose, increasing the consumption of health services by 5.1% in the second quarter.

This was also helped by Government spending on Test and Trace and the vaccination programme, the ONS said.

The ONS also said education output jumped during the second quarter as schools reopened.

But vehicle production tumbled by 16.7%, which the ONS said was because of "a global semiconductor shortage".

However, growth fell short of Bank of England forecasts at 5%.

Last week, the Bank of England said it expected GDP to rise by at least 5% over the period when most of the economy, including indoor seating and trial concerns, returned from lockdown.

ONS deputy national statistician for economic statistics Jonathan Athow said: "GDP is still around two percentage points below its pre-pandemic peak."

Economists at Pantheon Macroeconomics had expected GDP to grow by 0.6% in June, and 4.7% across the quarter.

Overall, the UK economy is now 4.4% smaller than it was before the pandemic.

Did Covid restrictions last too long? Let us know in the comments below

What is GDP?

Gross domestic product (GDP) measures the value of goods and services produced in the economy and essentially values how strong it is at any given period.

It’s usually calculated by the Office for National Statistics, which will consider areas that have lost demand and industries that have picked up, due to societal changes.

It also measures ‘goods’ and ‘services’ - these are things such as your washing machine, supermarket products and even the cost of a haircut.

As a measurement, GDP is often described as being a calculation of the total size of an economy.

The percentage value represents the growth or the shrinking of the economy over a period of time, usually one quarter (three months) or one year.

In real terms, two consecutive quarters of negative GDP growth can trigger a recession.

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