Chambers reacts to latest GDP figures
Commenting on the latest GDP figures published today by the ONS, BCC Head of Economics, Suren Thiru, said:
“The UK economy recorded stronger than expected growth in the final quarter of 2020 as the squeeze on output from the November lockdown was more than offset by a temporary boost from the release of pent-up demand from the subsequent easing in restrictions, increased activity from the coronavirus testing schemes and Brexit stockpiling.
“Despite avoiding a double-dip recession, with output still well below pre-pandemic levels amid confirmation that 2020 was a historically bleak year for the UK economy, there is little to cheer in the latest data.
“Modest growth at the end of 2020 is set to be followed by a substantial fall in output in the first quarter of this year as the current lockdown, the unwinding of Brexit inventories and disruption to UK-EU trade flows combine to suffocate activity.
“While the vaccine rollout offers optimism, with the scarring caused by the pandemic likely to crystallise as government support winds down and the prospect of persistent post-Brexit disruption, any recovery may be slower than the Bank of England currently predicts.
“The current drip-feed approach to support measures means firms cannot plan for more than a few weeks ahead. It is critical that the government swiftly implements a package of measures that support businesses and the economy for the whole of 2021, including removing the cliff-edges for business rate reliefs, VAT deferrals and furlough.”