Britain’s economic rebound slowed sharply in May, according to official data, which also showed the effect of a global shortage of microchips on automakers.
GDP grew by 0.8 percent from April, the British Office for National Statistics said, a lot weaker than the median forecast of 1.5 percent in a Reuters poll of economists.
The office revised down its figure for growth in April to 2.0 percent from its previous estimate of 2.3 percent — reflecting a reduced contribution from COVID-19 testing services — although the estimate for March was increased.
“Of course, the pace of the recovery was always going to slow as the economy climbed back towards its pre-[COVID-19 pandemic] crisis level, but we hadn’t expected it to slow so much so soon,” Capital Economics economist Paul Dales said.
Sterling fell slightly after the figures were published.
The Bank of England expects Britain’s economy to grow by 7.25 percent this year, the fastest annual growth since 1941 when Britain was rearming during World War II.
Last year, output plunged by almost 10 percent, the biggest drop in more than 300 years.
April saw the easing of restrictions for retailers, hairdressers and pubs and restaurants that could serve customers outside. In May, hospitality firms were allowed to resume indoor service.
“The sharp slowdown in growth suggests that the recovery is losing a little steam as the temporary boost from the earlier phases of reopening fades,” British Chamber of Commerce head of economics Suren Thiru said.
Despite the slowdown in May, the 0.8 percent growth rate was faster than typical pre-pandemic, month-on-month rises in GDP.
Britain’s dominant services sector grew by 0.9 percent from April, including a huge 37.1 percent monthly jump for accommodation and food services.
Industrial output grew by 0.8 percent, while construction output contracted by 0.8 percent from April, hit by the fourth-rainiest May since 1862.
The chip shortage affecting automakers led to the biggest fall in their output since April last year, the statistics office said.
Britain’s economy grew each month from February to May, but GDP was still 3.1 percent smaller at the end of May than it was in February last year, before the pandemic struck there.
Compared with May last year, when Britain was grappling to come to terms with its first lockdown, GDP was up by nearly 25 percent, the office said.
British Prime Minister Boris Johnson plans to lift most of the last restrictions from a third lockdown on July 19 after a fast rollout of COVID-19 vaccinations.
New cases of the Delta variant of SARS-CoV-2 have accelerated in the past few weeks, but private-sector data and surveys covering that period suggest no major hit to hiring or consumer behavior late last month and this month.
The office said that publication of trade figures, which should have been released with the GDP data, had been delayed.
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