Leading indicators including; financial markets, crude oil prices, transport numbers are all increasing, showing a slow move toward recovery. However, overall electricity consumption remains lower.
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The ONS has released data showing that March is down by 5.8% when compared to the same month last year. Q1 is down 2% when compared to the same period last year. This is the largest quarterly decline since the financial crisis.
IBISWorld predicts Real GDP Growth to decline by 13.9% in 2020-21. Assuming a three month lockdown period from March and a three month recovery period thereafter.
Accommodation & Food Service Industries
Most affected industries:
- Full-service restaurants
- Pubs & Bars
- Cafes & Coffee Shops
Pub operators are calling on the government to relax the two-metre social distancing rule to allow for pubs and bars to open as soon as possible. There are also calls for outdoor spaces in pubs and restaurants to be opened. The start of July has been earmarked as the earliest point that these businesses will be allowed to open.
Many operators in the industry have now started to reopen whilst social distancing measures still need to be implemented for the foreseeable future.
Residential house prices are expected to fall, despite an increase in April due to diminished supply. Savills expect this fall to be approximately 7% whereas Lloyds Bank have given a worse case scenario of a 23% decrease. Lower house prices feed through into some construction related industries, so a knock on effect is expected.
The average monthly FTSE 100 index has seen a slight uptick due to relaxed social distancing measures and a slow return to work although still remains well below pre-Coronavirus levels.
Negative interest rates have been introduced by certain markets and therefor, return rates of investors have also been impacted. This was seen in Europe after the financial crisis and has been undertaken as a bounce-back measure.
Updated Government Measures
The UK furlough scheme has now been extended until the end of October. Employers will be asked to contribute towards furloughed worker salaries from August.
£84 million in funding announced for projects working on Coronavirus vaccines.
Testing eligibility criteria has been expanded on 18th May to all those over the age of five that are showing symptoms.